Could it be that Peryite caused the disappearance of the Dwemer(Maybe with the help of Malacath, but we'll get to that later)?
We know that after attempting to use the Heart of Lorkhan to make all Dwemer into gods, they disappeared. The whole race, all of them. No one knows why, no one knows how. What we do know however, is that both Peryite and Malacath have powerful Dwemer artifacts as rewards for their quests. They are the only Princes who have artifacts not of Oblivion. Peryite has Spellbreaker. The original owner of the shield was a Dwemer leader by the name of Rourken. He left Morrowind and the rest of his kind with his clan for Hammerfell when the other Dwemer allied with the Chimer. He then battled Shalidor with his famous shield Spellbreaker. If and when Peryite made them disappear, why couldn't the Daedric Prince claim the shield as well?
But why would he do this? In recent games we have seen Peryite being a little Anuic by bringing order through plagues and diseases. Peryite and his followers try to keep the "natural order" in Tamriel. The ambitious Dwemer made all types of machines unnatural things which definitely upset the natural order and made this Daedric Prince their enemy. And then Peryite decided to cleanse them from Mundus itself. Through...The Blight. In Morrowind there was a disease called the Blight. Peryite is the Lord of Disease. Dagoth Ur could've found some way to use it from the aftermath of the Dwemer disappearance because he was in the Dwemer ruins of Red Mountain. Coincidence you say? I think not!
Going back to Malacath, Peryite also could've conspired with the Prince of Curses to accomplish the feat. I say this because Malacath also claims Volendrung as his artifact. Another "coincidence" is that it is the Hammer for which Hammerfell is named, Dwemer made and in the possession of, again, Rourken. The same Dwemer who owned Spellbreaker. Malacath is the Lord of Curses and the Spurned, and what better a curse or punishment than to send an entire race to the Pits or the Ashpit? The horrific Daedric realms of Peryite and Malacath?
I think I've cracked the code guys...