Board Thread:Lore Discussion/@comment-25291590-20130317093523/@comment-10207438-20140409195115

Some (including the Khajiit themselves) Believe the Khajiit originated from a race of Mer that split into the Khajiit and the Bosmer; if this is true the Khajiit should theoretically be able to interbreed with the other races.

However, The Argonians are known to have originated from regular lizards and reptiles that were exposed to The Hist; if you've read the Elderscrolls Novels [Infernal City and Lord of Souls] The Hist are known to be able to change the physical and biological properties of The Argonians, this could possibly include their [in/]ability to reproduce with the other races.