By my hands so when his body glows and falls apart I was given a chance to loot his corpse but it wouldnt open the loot menu. All in all I look around the floor amongst his summoned minions and no corpse. Game froze upon leaving so had to restart, hard save before battle and good to go second time around.

Am I missin out on good drops or is it glitched?

You're not supposed to loot Durnehviir (not possible anyway,) it might be Skyrim being Skyrim.

At least you can get out the second time, yes?

He is supposed to die.

Wasnt thinking Skyrim would pull a brain fart and silly me for not saving entering the boneyard, all I missed out was 22 minutes of gameplay so no big deal. Was about to start the battle again and get out of that god forsaken hell hole and get back to nature. Thanks for the fast replies!