Here's a better story than Tribunal's I thought up in 5 minutes in the shower:
You arrive in Mournhold after hearing rumors of a great plague. Indeed, you enter the city and discover that most of it has been cordoned off after a mysterious outbreak of corpus disease - something that shouldn't happen now that Dagoth Ur is gone. You quickly learn, by speaking either to the Temple or Empire, that the corpus outbreak appeared just recently and has afflicted the majority of the city, with its central districts cut off to keep the nobility and upper social castes safe.
Almalexia is using her remaining powers to preserve a magical barrier, which she can expand or contract as needed, but with waning strength it will grow smaller during the story and access to certain districts will be lost. Quest progress is not a factor in which areas of the city are still available, but time - it's impossible to complete every side-quest as traveling to a new district advances the clock, so the player will have to pick and choose which factions to help and how, in addition to investigating the causes of the outbreak. Naturally, both factions want the player to use this window of chaos and opportunity to undermine their rival faction in any number of ways.
You also quickly learn that in order to deal with limited manpower and the huge outbreak of corpus walkers and other monsters in certain districts of the city, the new king has contracted a goblin army to be "assembled" from the outlying regions. With no known cure, killing off the diseased is the best solution they could think up in such short notice. Although the goblins did their work at first, many of them have also succumbed to the disease, and due to low morale they are now running rampant throughout the city and are no longer under the Empire's control. Similarly, the Temple has contracted its High Ordinators to do their best fighting the diseased and has equipped them with special blessings of Almalexia's, but morale is waning. The player will find special corpus versions of both types of enemies throughout the story.
Word of the Nerevarine's disease immunity reaches both the Temple and the Empire, and both are eager to ask the Nerevarine to make a push into the cordoned sections of the city to find out what's happened and if there is any clue of where the disease came from. After some dungeon crawling, it's determined through a series of notes and records that corpus flesh was smuggled into Mournhold for some unknown purpose, but the information available is limited and somewhat conflicting, seeming to implicate both factions.
By now, the corpus walkers have reached the doorstep of the royal palace and Temple courtyard, and the Nerevarine can confront either faction with this information. The Empire blames the Temple, while Almalexia blames the Empire - both have reason to distrust one another. If the player has done enough quests for Almalexia instead of the Empire and has uncovered enough evidence, she will admit that she had the corpus flesh procured in order to study it, so she might better understand Dagoth Ur's powers - the outbreak was an accident caused by mishandling and she says she regrets the incident. Vice versa, the Empire truly denies they were responsible, but they admit their bringing the goblins against their will to fight the disease was not a smart move and caused more harm than good.
Now the player has a choice of going after one or the other "causes", and furthermore, if the player learned the truth, he/she can either keep quiet, persuade Almalexia to use her last remaining powers to heal all remaining diseased (though her pride and ego make this difficult), or tell the Empire (who are more than willing to punish the Temple). Almalexia, if the player did not find the truth, will heavily push the player towards wiping out the Empire presence in the city, maintaining the goblin army was there to cover it up.
Might not pass lore check 100% but I think the ambiguity involved would help a lot, as well as the ability to side with two mostly well-meaning but ultimately not-completely-untrustworthy factions.
