That official Daggerfall guide had some convoluted crap talking about it:
http://www.imperial-library.info/content/daggerfall-narrative ("The Real Story")
...but I'm pretty sure it's just convoluted crap. The person who submitted it said that it was most likely false because it claims that one of the orcs killed Lysandus, even though Lysandus was begging for vengeance against Woodbourne.