Location: southwest of the Waterfront District (link goes to the Daedric Shrine map at UESP)
Minimum Level: 20 (sort of)
Offering: 500 gold
Objective: Bring him the sword, "Umbra"
This quest is almost totally wacked unless you have installed the patch, so if you haven't installed it, don't take it. Instead, just collect Umbra and take it to Vile without starting the quest. I say "sort of" on the minimum level because you can collect the quest object any time you'd like. Umbra (you may remember it from Morrowind) is permanently in Vindasel, an Ayleid ruin southeast of the Waterfront District on the Red Ring Road (you've probably been jumped by a Conjurer while passing by).
Clavicus Vile tells you that he wants the sword, Umbra, and that you should start looking in Pell's Gate. He gives you a dog figurine and sends you on your way. About the time you get to Pell's Gate, you'll hear a voice telling you that getting Umbra for Vile is not a good idea. Umbra is nothing but trouble. This is Barbas, the dog figurine. When you get to Pell's Gate (it's just off the road on the way from the Imperial City to Bravil), you'll need to talk to Irroke the Wide. If his disposition is 60 or better, he'll tell you about an apprentice, named Lenwin, who found the sword, started calling herself Umbra and then took off to be a fighter. Umbra was last seen near Vindasel. So dungeon-delving you go.
The ruins are fairly small as Ayleid ruins go. You'll not come across much more than critters and traps until you get to Umbra herself. There's a floor-drops-into-spikes trap in one room and a poison gas trap in another. But otherwise it's easy enough. And then you'll get to Umbra.
Umbra offers you a choice: leave and live or fight and die. Of course you're going to choose to fight, right? Well, you will if you're honorable or a real sucker for punishment because as soon as you opt for combat, she pulls out her sword and goes to town on you. No, the key to winning against Umbra is to get in a massive first strike and then use every trick in the book to keep yourself alive while you whittle her down the rest of the way. For example, you can cast a good "Resist Poison" effect on yourself and then run around the poison gas traps in the ruins while she takes damage and you don't, and then you can lead her into the spike trap if you're far enough ahead to get away with it. Or you can use a good enchanted bow to pepper her with arrows while you try to stay out of range of that sword. Or maybe a combination of all of those. In any event, if you want the sword, you'll have to take her down however you can.
Once you have the sword, go back to the shrine. If you choose to give the sword to Clavicus Vile, you'll get the Masque. If you choose to keep it, it goes to its normal weight of 45 pounds, but otherwise functions the same.
Where the quest is wacked is that it causes the game to crash. You can't give the sword and you can't keep the sword and the dog appears to be the cause of it.
If the quest is not active, Umbra will not have anything to say to you aside from something like "the sword hungers". That's OK, though. You can still initiate combat if you want. But think first. As a friend of mine used to say, "don't let your battleship mouth get the better of your rowboat ass." Unlike most other encounters in Oblivion, Umbra is not a leveled creature. She's flat out level 50 with 100 in Strength, Speed and Endurance, all combat skills at 100, close to 400 health, and she regenerates on top of it. Not to mention the Ebony Armor and the sword itself. I've managed to take her out at fairly low level, but it took seriously pumped Strength, a massively poisoned weapon and a 6x backstab to knock her health down to where it was something vaguely resembling a fair fight and even then I only barely survived. Also, once you have the sword, you can always give it to Vile and complete the quest, even if you're still a 1st level character. If you'd like to pick it up at very low level, there's an article at the UESP Wiki telling you how.
I rather like the sword. The enchantment is nice, if you're into the soul gem thing. And if you're using the "stacked soul gem" exploit, it can't be beat. But what makes Umbra so nice is the fact that until you refuse to give it to Vile, it's one of the best weapons in the game. It does decent damage, has no weight and it can't be removed from your inventory (like when you give all of your stuff to Harrow in "The Shrine of Mehrunes Dagon" part of the Main Quest). All in all, it might be worthwhile to try to get it early in the game.