His body is near the smelter, shut in a cage.

Probably made an example of so the other workers would, you know, work and not run amok like children?

Have you done the forsworn conspiracy quest and let the forsworn escape, they will go on a crazy killing spree and may have killed him.

If not then I dont know.

That Nord was drowned because the Silver-Bloods are trash, thats why.

Because Markarth is a messed-up city?

because all the cool kids drown themselves in markarth, i thought everyone knew that by now...

No, he's there before the quest even starts. I'm going to go with Eayri's theory.