I don't think that King Helseth would have realistically survived. His palace is in the city of Almalexia which, if I recall correctly, is near Vivec-the site of impact. He and everyone else in that city were probably drowned and then boiled afterwards. I could see Barenziah still being alive... she may have moved somewhere else before the events of The Infernal City occurred.
Mournhold is a long, long way away from Vivec, and it isn't on the coast.
I doubt anyone will be cultivating anything on Vvardanfell for a while. The whole place will just be black rock, although that makes extremely fertile soil eventually, so the long-term prospects for life returning to Vvardanfell are pretty good
If any miners were to survive, it would logically be the egg miners, as they still have something to eat.
In all honesty, though, I doubt the eruption would have occurred instantly, and then neither would it instantly tear Vvardanfell apart.
First, I would say that the meteor impact would have directly destroyed Vivec and Ebonheart. Seyda Neen, Suran and Pelegiad would be destroyed the massive earthquakes and such, although most cities on Vvardanfell (and a fair few on the mainland) would probably be pretty damaged. A few mintues, maybe, after the impact, tidal waves would destroy Hlla Oad, Fort Firemoth, Tel Branora, and any cities along the mainland coast south of Vivec. After that, the geothermal activity ander Vivec would probably erupt, destroying most of the surrounding region, places like Molag Mar and Balmora. The clouds of dust and steam would probably start to sweep across Vvardanfell. I doubt Red Mountain would erupt for a good few hours, and even then it would would take a while before it went completely. This would be more than enough time for anybodywho could teleport to escape, but boat would probably be impossible, as todal waves would be bouncing around the inner sea coasts. Of course, by the time Red Mountain fully erupts, Vvardanfell wouldn't really have a chance. The ashes from the mountain would quickly blind, poison, and cover most life on the island, and the massive earthquakes would allow the sea rto quickly flood large areas. If the whole of Red Mountain blew, all that would be left of Vvardanfell would be a ring of waterlogged islands around a massive fiery, boiling crater, at least until new rock bubbles up enough through the water to form an actual landmass. This kind of eruption, and subsequent tsunamis, would probably flood a lot of low-lying central morrowind, and the earthquakes could cause some damage as far away as the Imperial City probably.
I'm surprised Solstheim escaped the tsunamis relatively unscathed! All up, though, I would give the people of Vvardanfell about four hours from impact to total annihilation, which is obviously not enough time to escape for 90% of the population. The idea that they were vapourised in minutes is ridiculous, though.
In terms of land returning, though, 200 years definately seems long enough for a large amount of the island to reform, although I wonder whether Red Mountain will still be active then as well. If not, then not much land will be popping up.
I doubt the Nords would want to invade a land that had recently been so thoroughly coated in toxic ash and gas, but that is probably nothing for the Argonians. They live in Black Marsh!