The rieklings resemble goblins much more closely than elves of any sort, its hard to imagine why could have devolved that much. Also, falmer were supposed to be very magically talented. The ice warriors from Dawnstar seem to be much closer to the mark physically.
Yes, 'snow elves' is a lame name for them but Falmer is probably their name for their own race and sounds much better.
As a race they were extremely reclusive, and we know nothing about their architecture. I could imagine an easter egg where deep in a cavern you find a massive door that cannot be opened, or perhaps beautiful ruins atop unscaleable cliffs. Maybe a few archaeology-ish quests that raise more questions than answers. Any of that could preserve the air of mystery. Maybe even a few unique weapons of falmer make. I wouldn't want their ruins to dominate the way ayleid ruins did in OB tho.