It's high time we got some answers regarding the http://www.uesp.net/wiki/Morrowind:The_Battle_of_Red_Mountain. 2012 will mark the tenth anniversary of the release of http://www.uesp.net/wiki/Morrowind:Morrowind in which we first learned about the disappearance of the http://www.uesp.net/wiki/Morrowind:Dwemer. What better way to celebrate it than with the release of an expansion that finally reveals the mysteries of the Dwemer?
But how could Bethesda tackle this in-game and have it make sense? After all, the Dwemer disappeared 3,751 years ago way back in the http://www.uesp.net/wiki/Lore:First_Era#Eighth_Century. For comparison's sake, http://en.wikipedia.org/wiki/1740_BC what was happening on Earth 3,751 years ago.
What follows are a few ideas for a "main" questline (very minor spoilers to follow) that could make sense:
1.) The quest picks up where http://www.uesp.net/wiki/Skyrim:Arniel%27s_Endeavor leaves off. He's disappeared after doing a very poor recreation of what originally caused the Dwemer to vanish. You're stuck with a powered down version of Keening and a confused look on your face.
NOTE: The expansion would have to alter Arniel's original quests to make it so anyone could complete them at any point in the game.
2.) Luckily http://www.uesp.net/wiki/Skyrim:Enthir has a risky plan to send you to the past to witness the Dwemer's disappearance first hand. How? You need to gather all the original artifacts used by http://www.uesp.net/wiki/Lore:Kagrenac%27s_Tools (Keening, Sunder, and Wraithguard), find the remains of the http://www.uesp.net/wiki/Lore:Heart_of_Lorkhan buried deep under the ruins of http://www.uesp.net/wiki/Lore:Vvardenfell, and obtain a long-hidden Elder Scroll. The Elder Scroll you find opens a time rip (we know this is already possible) that takes you to before the tools were originally used that resulted in the disappearance of the Dwemer.
3.) The expansion's new worldspace would be between the present (the ruins of Vvardenfell) and the past (Vvardenfell at the height of Dwemer influence). It would roughly be the same map and you'd be able to compare and revisit locations in both times. You know all the ruins we visited in Morrowind (and Skyrim)? Now you get to see them when they were in mint condition and populated by Dwemer NPCs. You start with Keening and journey to the ruins of Vvardenfell to recover Sunder, Wraithguard, and finally re-discover what's left of the Heart of Lorkhan.
4.) Through the quest line, you ultimately end up bringing back a large contingent of Dwemer to the present to restablish Dwemeri presence in Tamriel! They would settle in the ruins of Blackreach and slowly start repairing and restoring the entire area. Through further quests with the Dwemer (helping them recover necessary items from other ruins), Blackreach would be established as a fully functioning city of Skyrim. Other minor changes would happen throughout Skyrim. Perhaps the Dwemer help rebuild Winterhold with their fancy technology. Perhaps the reappearance drastically alters the next TES game to rely more on steam-punk tech versus magic.
5.) As a final bonus to the expansion (after the final quest for the Dwemer is completed), you would have access to a mystical machine - located deep within Blackreach - that utilizes Keening, Sunder, Wraithguard, the Heart of Lorkhan, and the Elder Scroll to send you back in time and "restart" your game as a Dwemer. This is the genius of the entire expansion. With only a few minor changes in dialogue to the original game and the expansion, it allows you to play the original game as the http://www.uesp.net/wiki/Morrowind:Yagrum_Bagarn remaining Dwemer who not only is the Dovahkiin, but is also on a mission to find out what happened to his ancestors.
New dialogue would have to be recorded throughout the main game (and expansion) as I'm sure people would be astonished to see a living Dwemer. Other than that, the game could stand virtually unchanged. As an additional bonus, when you "restart" the game as a Dwemer, your original character is converted to a wandering NPC (with current levels, skills, perks, and equipment) that you can find in your journeys and have a super-awesome follower with customized skills. He could be as powerful or as weak as you originally trained him to be. Perhaps he has a bunch of shouts to help you on your adventures. Two Dragonborn badasses exploring Skyrim? Yes, please.
What do you all think? Is this doable? I think it is. I'm sure I'm forgetting some problems that Bethesda would run in to, but from a gameplay standpoint, it's nothing that couldn't be overcome with some creative decisions.