Yes, but beast races shouldn't be able to breed with humans, because of anatomical differences
Maybe you have a point with Argonians, but the Khajiit are mammals too. Considering Argonians have been said to house their eggs internally too... and this is a fantasy universe, it wouldn't surprise me if it's possible.
There's no human being in their right mind that would have sixual intercourse with a bipedal feline or reptilian being.
It's obscene. There would never be any half kahjaits or half lizardmen. It defies logic and breaks immersion.
This is exactly the kind of argument disgusting racists used in the past. If it's a person I don't care what it looks like, it's not "obscene." And no, "person" does not mean "human" in my opinion. The Argonians and Khajiit are intelligent people. Just because they look like animals doesn't mean they
are animals. Are humans monkeys? No, they are monkey-like, just as the beast races are animal-like.
I find nothing wrong with interracial relationships in TES, be they any of the races, including the beast races. They are not animals, end of story.