I'm working on a mod for Morrowind involving an underground city, and for the backstory, I had the idea that the people living in it are descendants of some members of the Sixth House from way back. The first generation of people in the city went into hiding underground to escape the Temple's ethnic cleansing of the Sixth House after the Battle of Red Mountain. The people living there now bear little resemblance to the Sixth House of the previous and current era, and after so much isolation are more like a hereditary kingdom ruled by the family of the senior members who fled.
My main question is, how would the Temple react to the discovery of them? Does it still make sense for them to be hiding?
I figure that the Temple would be scared of them declaring them false gods and weakening the people's faith, then use their ancestry to justify the city's sacking and spin it as destroying a nest of Dreamers/Sixth House base.
Also, a large part of the plot would revolve around the player having the choice to keep their secret and quest for them as an ally who knows of the outside world, or joining the local quisling and betraying them to the Temple, winning riches and power from the higher ups in the Temple who know the people there are not Mr Ur's servants, but see the city's destruction as necessary to keep the faith and the Ghostfence strong . Does this make sense?