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That sounds like a good plan. The hire car companies do have depots at Oxford. They are in the outer industrial areas, but easy enough to get to. With Oxford, parking is an absolute pain in the centre of town. I normally drive to a Park-and-Ride station and bus into town. The walking tours are great, including the Inspector Morse tours. If you want to impress the guide, mention that you've been to the places in Australia where one episode of Morse was filmed - The Promised Landl Although, accommodation in Oxford is hideously expensive. You could stay at Abington or Kidlington, and bus it into Oxford.Points taken.
Would prefer those quainter & character-filled places than Oxford - it just looked closer than London on a map. And was thinking of doing a Morse/Endeavour/Lewis tour which, for those who watch Brit cop dramas, are/were based in Oxford.
Was thinking of hiring a car as we did that last time we were in UK (well, all the times we've been there) and it's very convenient but this time we thought we'd go rail-heavy and just hire car when/if needed. But certainly to explore Cotswolds a car is a given and was thinking Oxford would have rental businesses in town for pickup/dropoff, not that I've done any research yet but would've thought Hertz/Avis/Europcar and other usual suspects would be in a larger centre than other regional towns...or maybe we do pickup/dropoff in London? Hmmm - something to think about.
For the Cotswolds, Stow-on-Wold is a good place to use as a base, it's a cute old wool market town, with lots of character and pubs.
The other thing I found, driving around the UK, is the place is so small. When you're planning your trip, load it into Google Maps and see what it suggests for the driving time. It can be surprising short.