You have to remember that Skyrim is in 4E 200 or so, which is, of course, 200 years after Oblivion. That's definitely enough time for a city to go to ruin, especially with all the goings on in Tamriel since then.
True, but that image is probably taken in Markath side. Reasoning? Scroll down to the screenshot viewer at the bottom of the article, on firefox, right click and open in new tab (dunno for IE). The image is called Markarth01.jpg. The map of skyrim http://uk.gamespot.com/pages/unions/read_article.php?topic_id=26743582&union_id=1481 shows the city "Markarth Side". Furthermore, it's placed roughly in the area where there large canyon lies, the screenshot looks a lot like the city/ruin is in a canyon. Moreover, it's also the area of the up to date map that is currently blurry.
My point is, that place is most likely Markarth Side, so either we've got out last city, or some interesting ruins to explore. Either way it's a win-win situation IMO.