Not sure if this counts as a spoiler really, but I posted it here anyways. Regardless, I was talking to M'aiq and he said something VERY interesting. He said "M'aiq knows why Falmer are blind. It has nothing to do with the Dwemer disappearing. Really."
This got me thinking, maybe the Falmer being blind has nothing to do with them disappearing, but the Elder Scrolls cause blindness, and we know the Dwemer loved messing with them, maybe M'aiq was suggesting that they got whisked away into another time in the future by an Elder Scroll? This could definitely be the case considering M'aiq's past history of giving us partial truths..... It's definitely something to think about.

Just read some lore. http://elderscrolls.wikia.com/wiki/Dwemer

there is acutally a quest in the mage college where you will find out exactly how they disappeared
no elder scroll

Well shoot. There goes my Elder Scrolls theory. But does that mean M'aiq was telling the truth? IMPOSSIBLE! He's M'aiq, the falmer being blind has to have SOMETHING to do with the Dwemer disappearance!
Which Mages Guild quest? I did all the main ones, never found out anything about Dwemer though.

I thought it was clear in Morrowind. Both the main questline and the mages guild tackle this in that game. I haven't come across anything in Skyrim thus yet, but I have found out that they have "relations" with the falmer.

The Falmer are blind because the Dwemer forced them to eat poisoned fungi. This happened back when the Falmer retreated underground to escape the elven genocide being carried out by the Nords. You can read about this in an ingame book - can't remember what it's called.

Your theory would've been a much cooler alternative to "reality".

Well I remember what you discover in Morrowind, that Kagrenac used the tools and it caused the Dwemer to disappear, but I wasn't sure if that was actually proven to be true, and it definitely doesn't explain where they are now.

I'm not sure how the Dwemer moving forward in time would mesh with what Vivec said of their disappearance:

"I have no idea what happened to the Dwemer. I have no sense of them in the timeless divine world outside of mortal time. And, in fact, if I did believe they existed, I would be in no hurry to make contact with them. They may, with some justice, hold the Dunmer race responsible for their fate. My intuition is that they are gone forever -- and that is perfectly fine with me."

Then again, the Dwemer have always been an (intentionally) vague and ambiguous part of the series, and Bethesda has been known to mess around with the lore, so who knows, maybe they did Elder Scroll themselves into a different time.

They're supposedly in another realm according to Morrowind lore. I believe it's stated by the last dwarf in the corprusarium, but don't quote me on that, as I'm not a credible source.

Yeah I remember that. He says he didn't disappear because he was in some other realm at the time, and he believes the rest of his race simply went to another realm and he just has to find them.

I always figured it was the classic people trying to be god then the gods punish them for trying to mirror their greatness.