I can play fine, but after about 3-4 hours, my game becomes incredibly laggy.
I could assume it's just loading the scenery and things, but it only does it after a few hours game play.
It's getting to the point where I need to restart every 3 hours, and it's just so frustrating.
I play on the PS3.

Anyone help with how to solve?

I'm playing on my Xbox and I too, share the same issues. Its a bug that affects the console ports. Bethesda stated that they were looking into the issue and would patch it soon. (Can't find the source at the moment)

I had the same issue while playing Oblivion

Okay, thanks very much, it feels good to finally get some closure on this.