That may be true, but there's one important factor you are leaving out. As long as the Empire has control over all the provinces, there is peace and stability. Without the Empire, the provinces would be at each others throats. Not to mention other continents that could take advantage of this lack of unity, and suppress the supposed "oppressed" anyways. United the provinces are strong. Divided they are nothing. Plus, who likes the Dunmer anyways? :tongue:
Theorically I agree with you, but the Septim dinasty (cursed may be) sure did an awful job in creating a viable Empire. Cultural and religious domination, conquests by force, egomaniacal leaders, racism and an overwhelming sense of superiority certainly isn't going to cause much sympathy amongst the masses. To put a RL example, I also agree with Napoleon to a degree, but I'd have joined the spanish side (MY side) of our Independence War (yes, we spanish had one, too...) if I was born on that time. That's basically the same.
Any leader has to realize that or it'll always happen what has happened here: you end only dominating by the force of your army. And as soon as that force crumbles, your Empire dissapears, both because the faith of keeping peace is faded away (no armies = no peace), and because all the oppositors will take the slightest chance (and your weakest moment) to take you down.
Maybe a not-so-egomaniacal and self-centered Empire could success in uniting all of Tamriel again. But certainly the scars from the past, and from a forced conquest (and the humiliation that supposes) will take time to heal. IF it heals.