One day someone will eventually invent firearms
And I wonder why that is? Even in an insular society, advancements like such widespread use of machinery and tech would have a way of leaking out and if not adopted, then at least being experimented with by other cultures. Sure, plenty of scholarly or adventurous types are after dwemer stuff and we meet them often in quests. But that's a historical or archeological interest. Why not the interest by other races during the time of the dwemer?
Tamriel is more renaissance than medial, the sawmills in Skyrim is an 1700 design, it an replica close to there I live, even the carriage return function is real, however its not automatic, They also have printing presses of some sort as books is common and cheap.
Good chance they don't bother with guns much, the old non rifled muzzle loaders was very inaccurate, upside was that it was easy to train soldiers in using them and they worked well for large formations.
With aoe magic you don't want to have large thigh formations.
Cannons to break down fortresses would be useful however.
So, we see in the game that the Dwemer weren't the only ones with Steam technology, and industrial scale metalworking - The Daedra are as well. Think about it - coldharbour is full of relatively advanced tech and the Dremora seem to know an awful lot about it. Did they steal the tech from the Dwemer?