My theory: The Falmer are a special type of vampire (look at them!). The Snow Elf Prince would be the strongest, as he was supposedly equal to 100 nord warriors. When they took him down they gave him a nord burial. That means he's in a barrow. One of the patch files has a "coffin puzzle" and there are some coffin animations in there too. I bet the Nords didnt fully kill him, but sealed him away instead.
Why would the falmer be vampires you ask? After the Dwemer betrayed them, they escaped into the caves, starting the War of the Crag. Perhaps they made a pact with Molag Bal or some other Prince to hellp them win this war. They were underground 100% of the time, so vampirism would be 100% bonus. They would have to be special type though, seeing as they don't transmit the disease, and there wouldnt be much blood in the caves.
You can help refine this theory, seeing as the Snow Elf Prince was sealed away before the War of the Crag. Obviously there are holes in my theory.
Theory 2: The Snow Elf Prince is a vampire lord but now all Falmer are vamps. (I might add more later but kinda busy right now)

