My theory on the collapse of Winterhold is that it was caused when the Oghma Infinitum was sealed in an iceberg, possibly by the Augur of Dunlain.
The archmage, who was present at the time of the collapse, tells us that the city was destroyed by violent waves crushing the shore for days. He believes it might have been the aftermath of the eruption of Red Mountain, but as was already noted in the other thread, this is not terribly convincing: it was a hundred years before the collapse, the Winterhold event was a singular incident in time and location, and whatever caused the tsunami must have come from the north, not the east of Winterhold.
If you look at the map where the excavation site of Septimus Signus is, it’s due north of Winterhold. There is even a clear corridor without rocks and ice leading directly from the excavation south to the shore. As http://www.gamesas.com/topic/1323988-mysterious-new-glyphs/, there are hints in the decoded texts of the Oghma that it was sealed away in the ice by somebody who wanted to remove it from the world. I have no evidence that it was really the Augur who did it, but IMHO it would fit the picture perfectly: young mage dabbling in forbidden knowledge, then realizing his error and trying to seal it away, but unfortunately destroying a city on the way. Small wonder he hides in the Midden in shame.