There already in different religion groups and the different cultures or racial traits relationship modifier as well.
Why need something addition to force conflict when existing conditions already provide differences and conditions based differences that dont depend on overgeneralisations and irrational simplifications.
Just because the game Skyrim is centred around a thalmor ruled high elf-human conflict does not mean all high elves in all times are thalmor, as the lore makes very clear.
It wouldnt fit with the setting, while it would satisfy people who have only played skyrim think in black v white terms about everything it wouldnt make sense. Altmer are no more isolationist than most of the other races and if anything less than the dunmer.
Basically youre saying that because some jews see themselves as the chosen people all should have a massive negative modifier which everyone else and be more warlike. Which is stupid. The Altmer dont hate other races, they just see themselves as the true heirs of the Aldmer and true purest descendants of the Gods and so best, and theres a MASSIVE difference between seeing yourself as best and hating everyone else. If there is a xenophobic or racist trait that some characters get, then no more altmer should end up with it than other other race.
you forget that prior to tiber septim, humans and elves tried to drive each other into extinction or subjugation over the era's, so it wouldn't hurt the lore at all.