The book Magic and Climate of Menelgond makes me think my theory about a cataclysmic event or a demi-god created by the Great Machine creating the Underworld might be true. From the book: "One tells the story of an evil sorcerer who banished Menelgond below the surface; another claims that Menelgond is the origin of all magic and this magical influence created life and plants within the caverns. One day, however, this magic would be depleted and then Menelgond would fall into eternal darkness and all life within would dwindle to nothing."
In fact, both could be true. An all powerful being could have banished parts of the upperworld below, creating Menelgond. The magic flowing in Menelgond might be the last residual T-energy which one day would become depleted. It would explain how Dwarves, Dryads and Garema came into the Underworld while others books say they never saw the upperworld or the sun. That would be true for the current population, having long since forgotten their ancestral life above ground.
Hell the banishment could have even happened before Sacred 2 already (perhaps in the Dragon Wars). Those of the Dryads, Garema and Dwarves that were not caught in it, continued to live above the ground. And who knows if Anducar might not be involved somehow, either in the Wars for the Machine or the creation of Menelgond.