As far as the dunmer keeping the old Dwemeri name, despite their bitter, bitter hatred of them, this is not at all an unusual thing to do. Conquoring civilizations (I know the dunmer didnt 'conquor the dwarves, but the comparison still works) often retain the enemy names of their lands -even if the enemy is entirely gone. Why? Simple -this is what the land has always been called, the people don't know it by any other name, so th name is retained.

Here in the state of Indiana we even have examples of this, there are many towns, physica features, etc. with indian and french names, but those people of been gone for 200 years. We keep the names though, because that's the only thing we have ever known to call those places. (And don't give the THIS IS NOT EARTH!! AHH! I WILL DESTROY YOU FOR COMPARING THIS TO EARTH! I HATE YOU! YOU ARE MY ETERNAL ENEMY! response, because this is something that would have no reason to be different in Tamriel.) Also it should be mentioned to lengthen the comparison that many of the people in this area are of German decent, and really dislike the French and anything to due with them, yet they freely live in towns with French names!

Also, I do not believe that Vvardenfell would be a name the Imperials applied to the Island, as it is not in keeping with the spirit of Imperial names. If the imperials named the island something other than what the dunmer had previousely called it, than I believe it would have a more imperial sounding name. Also, I strongly doubt that they would have used the dwemeri name either.

Other than rwhole renaming, it can be alteration to better fit a different language - K?ln became Cologne in French and english (K?ln itself being a spectacular shortening of it's latin 'Colonia Claudia Ara Agrippinensium' name - quite a mouthfull).

In the case of Vvardenfell, the whole area was the dwemer's heartland (I could have used 'homeland', but it felt better) - the dunmer probably came to use the term when Resdayn was united under Nerevar. And the name stuck after that.

Isn't Vvardenfell where Lorkhan's heart was thrown? I mean, isn't i in the same spot? Or am I thinking of something else?

...Yes...in Red Mountain....