Despite the war taking place in Cyrodiil, they seem rather out of place. If they were going to go to war to help put one of the non-cyrodiilic alliances in power (ruling their land, as well as all of Tamriel), which would they align with?
the DC maybe? since if we are comparing society's, the Bretons are sort of the closest to theirs.... granted, an individual Imperial could side with anyone they chose, as the alliances are a bit more of united provinces than just the groups of races being united (I remember seeing a few Altmer NPCs that supported the Daggerfall Covenant)..
although I will agree that with the way the game was marketed Imperials do feel a little out of place, sort of like they were tacked on as an afterthought.. it would make a bit more sense if they hadn't featured it as a distinct race, and presented "Imperial" in the way it was back in Arena or Daggerfall (back then, "Imperial" wasn't its own race, but a culture of united ones.. they were never referred to as their own race until Morrowind/Redguard)..
This is kind of how I accepted it. Because Imperials are so widely spread all over Tamriel, they are basically just generic humans supporting whatever faction suits their personal beliefs, or is geographically where they call home. Though, as you pointed out, there are a few instances of other races doing the same thing, just not as frequently. I like to think it is likely do to geographical population density of those races. If you are an Argonian, do you really want to move to Summerset or Elsweyr to support The Dominion?
Yeah, we see the Orsinium King's advisor and his wife betray to the Dominion in a rather interesting quest. As for Imperials from what I recall reading they don't really care about the factions since they have their own problems to deal with but I can see them joining any side.
I suggested the creation of a Resistance faction which the Imperials could choose on creation. The player would spawn outside Cyrodiil in a country of their choice to avoid being thrown directly into the pvp areas. Obviously it will never happen.