Not sure if it's been mentioned before, but some evidence for the Ayleid -> Goblin theory can be found if you look at the names and symbols of the goblin tribes found in Oblivion. Two of the tribes, the Rock Biters and the Dust Eaters have feathers prominently displayed in their tribal symbol, while another tribe is actually named "Three Feathers." According to the Song of Pelinal, feathers are "the markings of the Ayleidoon".

[img]http://images.uesp.net/1/1a/OB-Goblin-DustEater.png[/img][img]http://images.uesp.net/c/c6/OB-Goblin-RockBiter.png[/img]

Above: The symbols of the goblin tribes I mentioned. Clearly feathers there, though it's not at all clear why. My best guess is, it's a relic in their culture from when they were Ayleids, and feathers were important to them.

Think im going to need to see more evidence

edit:try track down ho the symbols came around maybe? or locations of the goblin caves to where aylied ruins are?

Usage of feathers are pretty common among technologically backwards cultures. If there is a connection between the Goblin and the Ayleid usage of feathers, I would consider it to be more likely that the Goblins copied the Ayleid rather than being decedent from them.

Didn't the last of the Ayleid end up in Valenwood where are absorbed in with the Bosmer?

Awesomesauce.