The GameBryo engine was designed to be very flexible, it has been used in many games that have a completely different type of perspective and gameplay than Oblivion.  In fact most game engines that I know of are quite flexible, and even if they do require some sort of change for those differences it would be a minimal amount of work and a small cost for a project this size (otherwise they wouldn't use it).  I'm betting that Bethesda is going to try and make the game appealing to fans of the series and new players all at the same time, and making Oblivion with a Fallout facelift probably isn't the best way to go about that.  At least not for the next sequel, when I think about it I rather like the idea for a spinoff or new series entirely.  Fallout with the type of perspective of an Elder Scrolls game could be tons of fun, and they might fit very well together.

Hmm... Maybe they will try to reinvent the series, hell they own it now.  If Fallout 3 fails they could try this before dumping the series or abandoning it, or use the idea to start a whole new game series.