I found this from http://www.uesp.net/wiki/Lore:Summerset_Isle:

"During the Oblivion Crisis, Summerset Isle was beset by daedra. The Crystal Tower was toppled by the daedra hordes. The Thalmor, once a minority voice, were given greater power and authority in order to deal with the crisis. They were successful and came to be seen as the saviors of Summerset Isle."

"During the game of Oblivion you may overhear NPCs talking about trouble in Summerset Isle, quoting "I understand Daedra worship has become increasingly prevalent in the Summerset Isle." "They say syndicates of wizards have led a boycott of Imperial goods in the land of the Altmer." and "The Altmer have powerful wizards. It could become a dangerous situation."

Eh, the Nightingale Blade doesn't work with Assassin's Blade, it swaps the Magicka absorption for Stamina (losing trade for this build), is a leveled item that keeps you from progressing through the Thieves Guild questline until you're at the level you want to get it at, and is generally superfluous when you can self-enchant weapons yourself. Though it does look good, I agree with you on that.

I find this build, mainly the introduction to be ridiculous. Compairing an Elder Scrolls faction to the Nazi's and claiming false pretenses. The Talos worshipers are heretics, this is stated in the White Gold Concordat that the Emperor himself signed. Therefore it became law to outlaw Talos worship, and arrest those who disobey that law. People are just bitter that the Dominion beat the Empire. When the Empire threw everything they had at the Dominion, it wasn't enough. People are mad that the "good guys" lost to a superior foe, as a result they bend truth, and make the Thalmor out to be a scapegoat for the Empire's failing.

And in regards to the Daedric Dagger/ Bound weapons argument, I fail to see how the use of either of them declares you a Daedra worshiper. If that is the case everyone in Skyrim who uses conjuration is a Daedra worshiper. Conjuration is not inherently bad, it's the people who use it that build such stereotypes.

A belief thats backed up by law, dress doesn't matter, since several countries have a uniformed military, and police. Racial supremacy, COME ON really, that is just simple confidence that they have proven in the Great War. Elven kind was superior to the Empire militarily since, you know, the Dominion won.