Yes i understand how things work in Nirn, But how is Tosh-Raka the dragon god of time? Just because he somehow transformed into a dragon does not make him Akatosh. Akatosh's avatar is a dragon, but that doesn't make him a dragon. He chooses to make himself look like a dragon.
Before discussing this it's good to start off with the http://www.imperial-library.info/content/oblivion-shezarr-and-divines. They're an amalgam of two religions. That includes Akatosh.
Right now you're thinking of Akatosh as divine person that chooses his appearances. To a great extend this is not so. Akatosh had his appearance chosen for him when the Nine divines were drafted up. Be it within bounds of the original elements.
One might even go so far as to say that there is no specific divine person, but only a representation of a general force or idea. It'd be hard to melt two religions together without this. It's not like Alduin and Auri-El have that much in common at first glance. But this is actually not that different from real world religions and a bit outside of the scope right now.
Anyway http://www.imperial-library.info/content/daggerfall-light-and-dark provides a good basis as to the nature of the gods.
The story of Tosk-Raka as it's described in Mysterious Akavir resembles the various creation stories described in the Monomyth, the general events around the creation of Mundus. Though not described in the Monomyth, this includes a snippet from Faith in the Empire.
Auri-El (King of the Aldmer): The Elven Akatosh is Auri-El. Auri-El is the soul of Anui-El, who, in turn, is the soul of Anu the Everything. He is the chief of most Aldmeri pantheons. Most Altmeri and Bosmeri claim direct descent from Auri-El. In his only known moment of weakness, he agreed to take his part in the creation of the mortal plane, that act which forever sundered the Elves from the spirit worlds of eternity. To make up for it, Auri-El led the original Aldmer against the armies of Lorkhan in mythic times, vanquishing that tyrant and establishing the first kingdoms of the Altmer, Altmora and Old Ehlnofey. He then ascended to heaven in full observance of his followers so that they might learn the steps needed to escape the mortal plane.- http://www.imperial-library.info/content/morrowind-varieties-faith-empire
You'll notice the resemblance to the story from Mysterious Akavir. First a big war and then the war-leader ascends to heaven, leaving his followers behind trying to emulate. Given the similarity of all Monomyths even across continents we can assume this to be one as well.
So from this you can conclude that Tosk-Raka is Auriel is Akatosh - and coincidently shift back the assumed timeline of Mysterious Akavir a few thousand years.