How do you guys make do with Oblivion's 8-slot hotkey limitation?

Call me old fashioned, but if the game Oblivion offers a wide range of spells for the caster-preferred playstyle, I find it strange that there are only 8-slot hotkeys. Granted, it is due to the handicap limitation of the console system. For the PC gamers, how do you make do with such a crappy system? Are there proven and good mods out there that can help? Or I am just not playng Oblivion the right way?

For low level (still), I configure my hotkeys this way.

1. Heal - can't live without right?
2. Some kind of fireball - main destruction spell
3. Summon creature - good to have a creature out there to take care of some situations with more than 1 mob
4. Protective shield - take lesser damage ... more like the D&D or WoW's Power Word: Shield, no? How to live without?
5. Sky light or something like that - I don't like carrying a torch ... besides, I can train up my spell by turning myself into a "lightbulb" every 2 mins or so, why not?
6. Detect Life - I feel much safer that way. Besides, I can manage to spot mobs hiding at some blind spots.
7. Ease burden - I am a caster who can't carry much. So I need this spell to be on at all time so as to carry a bit more.
8. Potion - Yep, that is my panic button.

So, my usual drill is ...

Hit 7, hit C, hit 5, hit C ... and then every now and then, hit 5, hit C, hit 6, hit C, hit 4, hit C ...

Only then I can start to attack. I am sure there are better ways, right? Besides, I really need to add a bit more spells that I can use due to the situation. Spells like weakness to fire ... perhaps a shock spell, weakness to shock ... etc. Bear in mind that I am still a lowbie. I am sure there will be tons of spells that will become useful to me later.

Eager to hear your thoughts on this rather old game.