"'One thousand eight years,' you've heard it. You think the Cyro-Nordics came up with that all on their own. You humans are better thieves than even Rajhin!"
From the Khajiit account in http://www.imperial-library.info/content/obscure-where-were-you-when-dragon-broke. The 1008 years is true - at least from an "internal" perspective. Nobody says, however, that the Khajiit use the same calendars as Imperials.
Consider it like a time singularity, perhaps. A black hole exists in a finite area of space, but is nonetheless a discontinuity in space-time. Another anology would be the remembrance of what feels like hours of dreaming when you wake up from a half-hour nap. The Dragon Break is where the usual rules of causality and time are not true, but what we don't know in this instance is what would cause a Dragon Break to stop. It's a subject worth considering, although there are unlikely to be any concrete answers, unless you can pull something very clever out of ESO's new books. But the basic understanding of time being "bounded in domain but nonlinear" can be quite simple if we allow more than one dimension of time.
Dragon Breaks can also be understood in the historiographical perspective, as in http://www.uesp.net/wiki/Lore:The_Dragon_Break_Re-Examined:
However, this doesn't deny this existence of nonlinear time in itself, as that book is even discontinuous with its own place in time. Fundamentally, Tamriel's written history and reality interact in most unusual ways. The scholars find themselves changing history, and history changing itself according to some extant will.