Their Dragonskin combined with their 25% Magic Resistance would make out for a total of 75% blockage of Magic against him? If so...does this include Dragons frost and fire against the Breton?

Yes and yes

Isn't Dragon frost breath and fire breath elemental though? Or does it really count as magic?

Both effects apply separatelly, so you block 'only' a 62.5% of the effect, but yes, dragon breath count as magic attack.

http://www.youtube.com/watch?v=tRVUOGUmxJI&feature=related

Dragon Skin is Magic Absorption, Breton Blood is Magic Resistance. These are not additive, these are multiplicative.

Absorption is always computed first and corresponds to the chance for the spell to be entirely absorbed or not absorbed at all. While Dragonskin is up, that would mean that roughly half the spells hitting you would still go through. Then, Magic Resist kicks in, Breton Blood negating a quarter of the damage.

Same with specific elemental resistances, by the way. They are counted separately. So a Nord with 50% natural Frost Resist and an amulet granting 50% Magic Resist would still take 1/2 x 1/2 = 1/4 of the initial damage.

yeah bretons rock haha, I can tank dragons baseline

Breton's Dragonskin with the Atronach standing stone gives 100% chance to absorb spell I do believe, there is a -50% magicka regeneration rate but that is easily replaced, restoration even has a perks which recovers it (but costs 2 perk points for the 50%). When you have both effects you're entirely immune to all spells and absorb their magicka, as absorb always kicks in first as well... tho going for the lords stone instead gives a +25% magicka resistance and +50 (physical) damage resistance to give a static 50% magicka resistance with agent of mara that goes to 65% and 2 alteration perks in magicka resistance that becomes 85% which is the cap for magicka resistance, being entirely passive you always have it. The most you can get with Atronach stone bonus is 70% with having all 3 spell resistance effects from the alteration tree.

Technically the best magic resistance you can get is as a Breton, using the Atronach stone, getting the agent of mara blessing, and both the 3rd tier spell resistance effect and the 30% spell absorb effect from alteration. After this you literally only take about 6% of all spell damage tossed against you.... as you absorb fully 80% of all spells but on the spells you do not absorb you take 30% of the damage; this means this is slightly less reliable then going with the lord stone where you always only take 15% of all spell damage from 70% of all spells so that you're taking a 10.5% of all spell damage tossed against you but it is more stable.