User blog comment:Jimeee/Skyrim 1.9 beta update adds Legendary difficulty and raises level cap (Updated Apr 8th)/@comment-1992639-20130307153033

I think you can only switch a skill to legendary level just once. This probably allows you to reach level 99 or 100. I think that when you switch the skill to legendary, you lose both the skill points and the perks. You simply level them up again.

For someone who wishes to test this: Use the command console to set your level to 81 and set all your skills to 15. Then level them to 100 again each and see if your character level sticks at 99 or 100.

If there is no level cap at all, grinding over and over is a potential dead-trap. At one point when you're level 250 then, you will only have an increment of health, stamina and magicka. But your defenses and skills will be the same. While NPC's get a boost to all their strengths and health with each level. Fighting level 250 dragons with 50,000 health, having only 800 health myself is not my idea of good game design. :) So since the patch note said the removal of the level cap at level 81. It probably only raises the bar to a logical number, usually 99 or 100 for games.