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They are not Evil, per say, but some of them are destructive or inimical to life. They tend to have more overt power than the Aedra (since they did not give of themselves to create Mundus), but with a few exceptions (Mehrunes Dagon, for example) have little interest in actually controlling Nirn or Mundus, since their nature is rooted in change and are better suited to the mutable environment of Oblivion. They continue to rule Oblivion, though over time they have exerted varying amounts of influence on Nirn, seeking worship and other things. So, the Daedric Princes (or Lords) are those (primarily children of Padomay) who chose not to participate in the creation of Mundus. Lorkhan's body remained in the sky as Nirn's two moons. Where it struck, it pierced the crust and caused a massive volcanic eruption and the formation of a new island - Morrowind. When the other gods realized Lorkhan's trickery in upsetting the balance (by arranging the creation of Mundus and tipping the balance of power in Oblivion towards Padomay's offspring), they met to discuss the matter, and chose to punish the trickster - Trinimac (the god of the ancient Altmer, who later became Malacath due to Boethiah's interference causing the Chimeri exodus and (eventually) creating the Dunmer) ripped out Lorkhan's heart, which was also his Divine Source, fixed it to his bow, and fired it down onto Nirn, into the middle of a large sea.
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Most of the lesser Aedra gave themselves fully to the creation of Mundus, forming the Earthbones of Nirn. Those who took part in the creation of Mundus (which is the term for the plane of existance which encompasses Nirn, its two moons, and 8 attendant Aedric planets) gave part or all of themselves to the creation - the 8 most powerful gave parts of themselves to the 8 planets, and are now known as the Eight Divines (Akatosh, Dibella, Arkay, Zenithar, Stendarr, Mara, Kynareth, and Julianos), and are the core of the Aedra. Most of the children of Padomay, however, refused, and remained apart. The idea of a stable world and set form appealed to the children of Adu, most of whom agreed to aid in the task. These beings (now known as the Aedra and Daedra) dwelt in Oblivion, until Lorkhan (known as the trickster, a child of Padomay) tried to convince the others to create Mundus. From this meeting was born a multitude of other beings, direct descendants (or perhaps products would be a more accurate term) of one (or both) of the two. In the beginning, all was Void, and Adu, the ultimate form of Stasis, and Padomay, the ultimate form of Change, met each other. For a more detailed version, here's the general version of "How the universe came into existance:"