Yet another possibility still for the "we don't have the tech right now" is that they might want to add naval combat to the game. Which would be cool, but we'd need fucking cannons. Naval combat don't feel right if it's pure boarding actions and/or catapults/ballista/mages chucking shit.
They could actually still be feuding, just kept under the table and the Dominion does it's best to hide the fact that it barely holds itself together. I mean if we imagine Elseweyr and Valenwood are PERFECTLY under Dominion control, there's not going to be much of a game. At the very least, trying to play anything but a stealth character is going to suck.
Plus, if ESO has shown me anything (I know, laugh if you will, I still enjoy it way more than Skyrim) Khajiit and Bosmer are pretty shitty allies from a military stand point with the khajiit only mildly less so.
I mean they're great for small squad skirmishings, but if you want to march on a whole damn city, the Altmer can expect to do it by themselves with Elseweyr and Valenwood only acting as buffers against counter invasions.
this is a fairly good point too. I know I wouldn't mind losing out on two provinces if the one gets heavily fleshed out and done well.
it's not just cities either, it'll be questlines and points of interest.
I will bet dollars to pennies though Bethesda will bring in settlement building from Fallout 4 though, or something very much like it.
in my ideal TES VI, one of the ways you can beat the main game is taking over banks, shops, farms, mines, merchant ships, and criminal syndicates and then basically then choosing a side to support, effectively starving the other logistically and driving the losing side nuts that they basically got beaten by the player being a bureaucrat than some great military mind or warrior.