You definitely do not look like an idiot -- it is a lot of lore! The answer to this question is actually in the world interaction questions -- a few people asked what happened to the mermen, so it's not entirely obvious unless you asked for it. :)

Indeed, this is the first time they know of the mermen being trapped, but they would know if they had asked earlier on that tens of thousands of years ago, there was a brutal King that subjugated the mermaids! The mermaids were treated like second-class citizens, and there was a massive civil war. The mermaids won, the brutal King was executed, and the first Queen took over, banishing mermen from Akvos. Where they were banished, the history books did not say -- but now you can probably guess they were put in another dimension by ancient magic.