The empire can replace its losses much faster than the Thalmor.
Signing the WGC is allowing the empire to rebuild its legions, the Thalmor know they will be outmatched and thus have started things like the Skyrim civil war and the Talos ban to try and break the Empires will for another war.
If that's true, what was the point of retaking the Imperial City?
Day One: The Thalmor have occupied the Imperial City and most of Cyrodiil, plus the southern portions of Hammerfell.
They offer you a full withdrawl of their forces from Cyrodiil, and they keep what the occupy in Hammerfell. Also you must disband the Blades, and cease Talos worship. Both of which would be humiliating, and a form of castration. Furthermore, the Thalmor have the right to cruelly enforce the ban on Talos worship within the Empire's borders - the most humiliating and degrading of all the terms.Day Two: Titus Mede risks the entire remaining strength of the Empire to reclaim the Imperial City. If he loses the battle, there will be no Empire because the Legions will have been decimated, the Thalmor might decide to just walk in and take the entirety of Tamriel now that the major force of resistance is destroyed. But luckily, Titus Mede's gamble pays off - he wins the battle and liberates the Imperial City, destroying the Thalmor Army in the process.
Day Three: Titus Mede sues for peace.
The Thalmor offer him a full withdrawl of their remaining forces from Cyrodiil, and they keep what the occupy in Hammerfell. Also you must disband the Blades, and cease Talos worship. Both of which would be humiliating, and a form of castration. Furthermore, the Thalmor have the right to cruelly enforce the ban on Talos worship within the Empire's borders - the most humiliating and degrading of all the terms. He accepts the same peace terms, with no apparent revisions, as he received two days ago when he was in a considerably weaker position.
Day Four: Hammerfell stands alone against the Thalmor, abandoned by their Empire. Alone they manage to push back the full might of the Thalmor, retaking the parts of Hammerfell occupied by the Thalmor. They sign a separate peace treaty, and end up an independent nation with all or most of their pre-war land.
So...no more arguments about anything else. This hinges on why Day Two and Day Three had to happen, and how Day Four proves that the Thalmor weren't an insurmountable military obstacle. If you can't explain this, I want to point out in the strongest possible terms that I feel any other argument or rationalization for the Empire's actions is null.
Disclaimer: Obviously these events didn't occur over the span of four days, I just used the timeframe as a simple, easy way to order events in chronological order.