I have a different problem. I play on medium, have now played as three factions and always the same outcome: Oblivion Hordes never end and appear unbeatable.
Played as Daggerfall, got on pretty well, conquered all of Highrock, defeated the Oblivin armies that spawned in my territory at great cost, continued expanding and some 40 rounds later started wondering why there were more and more Daedra armies swarming in. Managed to defeat quite a few, city defense being the only viable option but finally got sick of it and exchanged map info with them. They had conquered almost the entire empire, all of skyrim, most of hammerfall, elsweyr and valenwood and were making headway into morrowind and Black Marsh. Only lands untouched were my own - though I was being pushed back - and Summerset Isles. The other two games with other factions pretty much the same. I manage to slow their advance but they conquer everyone else and my doom is only avoidable if I evacuate to an island.
With Daggerfall I could make them bleed, possibly for a hundred or even two-hundred rounds but in the end I will always be doomed or sit in some island while Oblivion dominates Tamriel mainland. Haven't seen them build ships yet but if they can then it seems they will always win :-/
Anything I'm doing wrong here?