Vvardenfell has been obliterated, with the rest of Morrowind conquered. What will become of important figures like King Helseth or Barenziah? Or even perhaps Vivec, whom is debated to be alive?
What of the actions of our heroes? The Tribunal as we knew it is gone, Mannimarco is dead, the Dark Brotherhood is all but crippled, a new order of holy knights along with its saint has arisen, and even the daedric realms have shifted. Jygallag has returned, and a new mortal has supposedly taken the mantle of the Mad God. These events will surface in Skyrim, but how can it be realistically done?
What about the Empire? I doubt Titus would have left Ocato alive, nor would Ocato have submitted to a tyrant.