One vs One really is a matter of timing. You have to block at precisely the right moment. Just because it looks like his sword is hitting your shield doesn't mean you're actually blocking him (you'll note he still does damage). If you block at the right time, you DO stagger him for about a second or two, at which point you can get a few blows in. Try to find a hammer wielder and practice your blocking against him, he's easy because he telegraphs his blows, you can see them coming a mile away. Just be careful, if he DOES hit you, it hurts a lot.
I have to say that I'm getting back to having fun. I'm still facing truly ABSURD hordes of monsters (further on in the Kvatch mission, me and four Imperial Legion guys have to face off against SEVEN Flame Atronachs, 1 Frost Atronach and 2 ClannFears. I swear, I really really feel sorry for these poor NPC schleps...), but the difficulty slider makes a monstrous difference.
Earlier I had just switched it all the way to low, at which point everything dies in one or two blows. However, I've moved it back up to about 40% or so, and now it feels just right. Clannfears are still moderately tough, but at least now I do noticeable damage against them with my Dremora Longsword.
Yesterday when I had the game at 50% diff, and was fighting with my Silver Sword, I did no noticeable damage. I literally had to hit a Clannfear around SIXTY times before it would die. Now it's more like 8 or 9 times.
So the diff slider makes a ton of difference. If you're having trouble with the game kicking your ass, just lower it a few points, I think you'll find it makes the game a lot easier / less frustrating, and thus more fun.
I have to say that the Kvatch mission itself is a blast though, just well designed and fun to do. I just wish I could keep all those poor NPCs alive.