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As far as whether or not Hand-to-Hand is a reasonable option at high level, that is up to you, but for my part, no, it is not. Pugilists may not need to worry about weapon maintenance, enchantment charge, poison stockpiles, or being disarmed, but none of those nuisances even remotely compare to the pain that is beating down a dungeon full of enemies who each have several hundred to a thousand (or more) hit points ~11 damage (for a standard attack at 100 Strength and 100 Hand-to-Hand, before any applicable damage reduction) at a time. Even a masochist running around with an unenchanted weapon and no poison at level 20+ is probably suffering less, because at that point a "level-appropriate" unenchanted weapon is likely averaging at least 50% more damage per hit - at 100 Strength and 100 in the appropriate skill, Daedric weapons do between 20 and 30 damage per hit at 100% condition, or between 23 and 33 damage per hit at 125%, and until you get to really high levels you're probably not going to completely break an unenchanted Daedric weapon killing a single enemy even against things like Ogres, Minotaur Lords, and Goblin Warlords.
A further, albeit minor, issue with Hand-to-Hand is that blocking weapon attacks while unarmed does not provide any damage reduction, so a pugilist will also in general take more damage per hit received than a similarly equipped swordsman (or whatever). It can still be worth blocking attacks if you're going to fight with your fists, because doing so can make an opponent recoil (stagger) if your Block skill is at least 50 and thus creates an opening in which you can land attacks without being blocked, but it means you're limited to the 85% physical damage reduction provided by armor rather than the 92.5% for (armor cap + weapon block) or the 96.25% for (armor cap + shield block), before accounting for any applicable Reflect Damage and Resist Normal Weapons effects.
The Ring of the Iron Fist - much like the Amulet of Axes or the Necklace of Swords - is an item that's good because of the Reflect Damage effect; the Fortify Skill effects are largely irrelevant.
Thing is, you could delete Hand-to-Hand from that without losing anything - no build that's decent at high levels gets any appreciable fraction of its damage output from Hand-to-Hand.
I was just pointing out that, if someone wishes to play a hand to hand character to the end it is absolutely possible, but, it does need ingenuity (in other words, rather more than straight forward punching your way past ever stronger opposition). I used the Ring of the Iron Fist as an example ("one example" sic) of something which, when/if you find it can help you get there (and, yes, it is the reflect damage which is by far the greater help). I am sorry if I did not make that clear. Also, perhaps, I should not have thought it likely that the OP's question indicated the desire to know if Hand to Hand could continue to be viable to the end. (My apologies to the OP is I got that wrong.) Sure, luck or lack of it is a significant element, but, where would you be in any game if luck did not play a part?
BTW what, exactly, is a "decent" build? I know what build I prefer, and I doubt it is the same or even similar to your preference, but, who knows there are so very many possibilities. I would have thought, a decent build is no more and no less than one which can be taken, enjoyably and successfully, to completion of the end game which for me is generally somewhere significantly north of level 30.
Yeah and a hand to hand build while technically can be taken to level 30+, it would be grueling and basically torture. Every leveled creature like an ogre or xivilai will take you like 10 minutes to kill per enemy by level 30.
The damage you're doing with 100 hand to hand and 100 strength is roughly equivalent to a level 1 warrior built character with an iron long sword.
So while technically possible, you're playing the grindiest game ever where every creature is essentially a dark souls boss.
If you have access to the University. You can make yourself a spell that give you + H2H skill. Or enchant your gloves with fortify H2H.
Dremoras are okay as well as other humanoids because their stamina is low enough, but some of the big leveled baddies like ogres have much more stamina than hp.
And fortified h2h skill (and most skills tbh except athletics and acrobatics) does nothing beyond 100.
Your max damage with hand to hand is 11.5 damage with 100 h2h and 100 strength. By comparison a regular iron longsword has a base (unmodified) damage of 10
The other thing with that is that Dremora and Daedra are actually some of the easier enemy types to deal with late-game, because NPCs and Daedra - even Xivilai - don't have the ridiculously-high HP pools that a number of other enemy types get. Xivilai only have 336 max HP at level 30 and lack any ability to heal themselves unless maybe they rolled into a weapon with an Absorb Health enchantment; Gloom Wraiths, Ogres, Minotaur Lords, and Goblin Warlords all have well over 600 HP at the same point while Liches have 450, and both Gloom Wraiths and Liches always have access to an Absorb Health ability/spell; even Dread Zombies, with 'only' 340 max HP, likely have significantly more effective HP than most NPCs and Daedra when you're trying to kill them with a low-DPS weapon such as your fists due to their 5 HP/s passive regeneration ability.
You should try fallout new Vegas and fallout 2. Both of those make unarmed super powerful, new Vegas it's probably the most broken build.
https://www.nexusmods.com/oblivion/mods/49918
But when I had the most fun with the game was when I focused on hand to hand. I also found it was a lot more effective than blade or blunt. There are just a lot of advantages: speed, stamina and damaging enemies' stamina in addition to health.
Hand to hand, zero armour and good use of magic makes for a great end game as well as main game. My only gripe is that you cannot use poison with hand to hand, however, I do usually carry an enchanted dagger in conjunction with sneak for administrative purposes when I think a little softening up may be efficacious. :) 20++ slashes or bashes gets tedious, though, weapons do look smart. :)
(BTW does anyone know of any worthwhile game in this genre which focuses on martial arts?)
Race: Your choice. I picked Khajiit for the +10 bonus. Argonian/Imperial/Orc offer +5 bonus
Birthsign: The Warrior, grants a headstart on Strength and Speed. Your two most essential attributes.
Attributes: Strength, Speed, Agility, Willpower. Strength contributes to Hand to hand damage. Speed helps you move fast during combat, most effective when wearing cloth. Agility increases fatigue alongside Strength and Willpower, but also decreases your chances of being staggered. Willpower effects both magicka and fatigue regen,
Majors: Athletics, Hand To Hand, Alteration, Destruction, Restoration, Acrobatics and Sneak. Hand to hand should be main priority. Athletics and Acrobatics for maximum mobility. Sneak is useful to start combat against stronger enemies. The three magic skills all provide beneficial combat spells to give you an edge.
Minors: Everything else, but secondary focuses can be Block, Alchemy, Security. Block works surprisingly well with Hand to Hand. Alchemy to create your drinks. Security is lowest priority skill. Only really needed until you can get the skeleton key, afterwards its no longer necessary.
Weapons: None (Unarmed)
Armor: Boots of Bloody Bounding, Bands of Kwang Lao, the Eye of Sithis, and the Ring of the Vipereye. Anything I missed is your choice, so long as its light armor or cloth. Mostly cloth, but enchanted with either beneficial buffs or defenses to counter your shortcomings.
Spells: Elemental Shields, Unlock spells, Aegis, Elemental Touch Spells, Devour Health, Corrode Weapon, Greater Magicka Drain, Heal Superior Wounds