Best Answer GSDFan , 09 August 2015 - 12:20 AM
The proper way to use MO, Oblivion and OBSE is to set the “Launch Mechanism” in the workarounds tab to Script extender and Launch the game from Steam. This means that you mod in MO and run the game from Steam. You also need to enable the Steam community in game option in Steams Oblivion settings.
If you try to run the game from the MO configured “OBSE” shortcut you will get the “You are trying to use a Steam version of Oblivion. Steam users should launch the game through Steam, not by running obse_loader.exe. If OBSE fails to load, go to Steam > Settings > In Game and check the box marked "Enable Steam community in game". Please see the instructions in obse_readme.txt for more information.” message and the loader will exit.
If you run the shortcut “Oblivion launcher” the launcher will open as usual. If play is pressed it will close and open again and when play is pressed the game will start.
If the MO configured shortcut “Oblivion” is run the configuration utility will open up and you can run the game from here.
In all of the above situations you should not be running the game from here. Steam needs to be the mechanism to do this.
My theory on this, whether right or wrong, is that Steam launches the game, then the "in game community" which in turn allows obse_1_2_416.dll and obse_steam_loader.dll to do their work. The file obse_loader.exe is not needed for the Steam version of the game. It is for the retail version of the game only and should be deleted.
Running the game from Steam will allow the launcher to run first. At this point MO has not been loaded and if you view the Data files only the vanilla game directory will be seen. The launcher is reading the Oblivion.ini in the "My Games" folder and DLCList.txt and Plugins.txt from C:\Users\username\AppData\Local\Oblivion folder. Any changes made here will be written to those files and not the ones in the active MO profile.
Pressing the play button will allow the game to start, which in turn launches the 'in game community" and then allow the OBSE_XXXX.dlls to load, which will load MO as a script extender from the games vanilla directory. MO should now be active and the VFS and all of the MO mods should be loaded.
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