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I've discovered an interesting connection between the Khajiit and the Dragon Break (the famous one that the book's about). In that book, the Khajiit guy says that they were witness to the Dragon Break, whilst everyone else in Tamriel either slept through it or was there but can't remember anything about it.

The exact line is "the others did not have the sugar to see it". This is obviously moon sugar (the stuff skooma is made from if you haven't played Morrowind) so what mystical properties does it have? Is it somehow related to the Lunar Lattice itself? Does using it give you some sort of greater awareness, or detach you partly from space-time?

Maybe they were so high on moon sugar that they just thought they saw it?

I'm leading towards mass hallucination.
Basically, this just proves that those cats are crazy.

Whats is a/the Lunar Lattice?

The bit between Mundus and Oblivion - the barrier that keeps them apart, basically.