This we know: Blacklight was a major Redoran city on the northwestern coast of Mainland Morrowind close to the border of Skyrim.
To the south are the western highlands and a good road west connects through the Dunmeth pass to Windhelm.
History:
Tiber Septim used Blacklight as a staging ground due to the weak Dunmer defenses here.
Architecture:
Typical Dunmer Craftsmenship with Nord influences
Current events/speculation:
As soon as the Red Mountain blew its top the Argonians of Black Marsh invaded Morrowind beating the vulnerable Dunmer. Most of the Dunmer retreted to Solsthiem.
(The rest of this is all Speculation)
The Dunmer regain their Stength in Solsthiem and a united Morrowind Government Stage an assult on the Argonian held city of Blacklight. They retake the city but suffer major casultys. The Argonians retreat south in the Western Highlands and set up camp there. The Dunmer face new challeges trying to hold the city of Blacklight and also an impending counter attack by the Argonians but they need the help of an outsider to help Blacklights Residents, Economy, Government, and Defenses and Eventually drive the Argonians out of the western highlands.