I'm not sure if this is the right place for this, but here goes.

Basically this is a theory that doesn't have any evidence in the game and is just me taking advantage of plot holes and things left unsaid. (feel free to point out where I went wrong. I haven't looked at timelines in depth to see if my theory is plausible)

So basically the background is this. Three street urchins (an untrained mage (Ria Silmane), a Street thug (Jauffre) and a pickpocket/thief (Caius Cosades, younger than the other two)) attempt to rob a man, (Uriel Septim in disguise, off to sleep with some wench possibly Martins mother) only to be foiled by his bodyguards. Uriel takes pity on them and decides to adopt them into his household (judging from his impulsive nature pre-Arena this fits imo). Jauffre and Caius join the Blades and Ria is apprenticed to Jagar Tharn.

After a few months/years Jagar Tharn kills Ria and imprisons Jauffre and Caius in the ancient dungeons, and Ria's ghost helps them escape to High Rock through the Shift Gate, If I end up writing this as a fan fic Caius will be aroun 15-16 and won't be all that helpful earlier in the quest. The ten year span of Arena happens and Jauffre and Caius defeat Tharn and rescue Uriel who names Jauffre the Eternal Champion and grants them both the Septim name (maybe a bit over the top in bending the canon?).

General Warhaft steps down and Jauffre becomes head of the Blades with Caius as his second in command/spymaster. (I retconned Caius to be a thief, not a monk, as it makes more sense). Caius screws up big time by either letting one of Uriels sons die on his watch and/or degrading relations with one of the provinces (probably Summerset). As punishment he is stripped of the Septim name and exiled to the Illiac Bay area where he performs the feats of Daggerfall. Upon completion of this task he is exiled to Vvardenfell, albeit as a high ranking member of the Blades, and Jauffre retires as Head of the Blades and retires to Weynon Priory.

The Nerevarine arrives in Morrowind and Caius guides him. When riots in the Imperial City start (as referenced to in dialogue) Uriel recalls him to make amends and enlist his help. Caius dies protecting the Emporer or returns to Morrowind after the Dagoth Ur is defeated.

So, that's about it. Feel free to suggest more canon friendly options (I know it is stretching it thin as it is), or pick it apart.

I really like this. It would be great to see more of Caius and Jauffre before their stations as Blades, and making Jauffre the EC would be interesting as well. The one thing that I didn't like is Caius allowing one of Uriel's sons to be murdered as to my knowledge none of his sons were murdered until the Oblivion Crisis. If I had to suggest anything, I'd create a fumble independent of any canon plot point caused by Caius and his drug addiction. Or if you want Caius to stay awesome you could have him never screw up and just take someone else's bullet. Like if Jauffre screwed up, and being a pal, Caius accepted blame and got sent to Morrowind way under the radar to avoid a political fiasco. Synchronicity is fun though albeit tricky to pull off without sounding contrived. I wish you all the best fortune in this endeavor, and I look forward to reading it. I'll even critique it for you or help with editing if you want.

I like the idea of him getting hooked on skooma, and I'd really like to invent more characters to flesh out the "training phase" (before the events of Arena) and make the characters more memorable.

Well the Septim name seems a bit odd to me, and as Chaplain mentioned there is no evidence of any of Uriel's sons dying before the Oblivion crisis. Though there were rumors that they were replaced by imposters. For the rest I like your story, of course there is no evidence to support it. But it sounds good

I believe the Agent of Daggerfall met the business end of Big, Stompy Robot's heel in one of the endings of Daggerfall. Since all the endings happened at once, he's gone.

Also, somewhere on the Imperial Library, there is a dev piece written from Caius' perspective visiting dead Uriel VII's grave.

Other then those, it's a nice idea

In fact, you could have a plot featuring a member of the Elder Council creating simulacra of the Septim family and having Jauffre and Caius fight a shadow war and eventually kill the traitorous councilor. The only thing is that everything is so secret people think Caius murdered an innocent man, and rather than being hung, he's shipped to Morrowind where his stealth skills grow whereas Jauffre stops spying altogether falling into the mold of a scholarly monk.

The ending that kills the Agent is impossible to attain ingame, as you have to give the Totem to someone before going after the Mantella.