The Thalmor arent powerful yet they were able to put the Empire into submission?

"In what is now known as the Battle of the Red Ring, a battle that will serve as a model for Imperial strategists for generations to come, Titus II divided his forces into three. One army, with the legions from Hammerfell under General Decianus, was hidden in the http://www.uesp.net/wiki/Lore:Colovian_Highlandsnear http://www.uesp.net/wiki/Lore:Chorrol. The Aldmeri were unaware that he was no longer in Hammerfell, possibly because the Imperial veterans Decianus had left behind led Lady Arannelya to believe that she still faced an Imperial army. The second army, largely of http://www.uesp.net/wiki/Skyrim:Nord legions under General Jonna, took up position near Cheydinhal. The main army was commanded by the Emperor himself, and would undertake the main assault of the Imperial City from the north.
On the 30th of Rain's Hand, the bloody Battle of the Red Ring began as General Decianus swept down on the city from the west, while General Jonna's legionnaires drove south along the Red Ring Road. In a two-day assault, Jonna's army crossed the Niben and advanced west, attempting to link up with Decianus's legions and thus surround the Imperial City. Lord Naarifin was taken by surprise by Decianus's assault, but Jonna's troops faced bitter resistance as the Aldmeri counterattacked from Bravil and http://www.uesp.net/wiki/Lore:Skingrad. The heroic Nord legionnaires held firm, however, beating off the piecemeal Aldmeri attacks. By the fifth day of the battle, the Aldmeri army in the Imperial City was surrounded.
Titus II led the assault from the north, personally capturing Lord Naarifin. It is rumored the Emperor wielded the famed sword http://www.uesp.net/wiki/Lore:Goldbrand, although this has never been officially confirmed by the Imperial government. An attempt by the Aldmeri to break out of the city to the south was blocked by the unbreakable shieldwall of General Jonna's battered legions.
In the end, the main Aldmeri army in Cyrodiil was completely destroyed. The Emperor's decision to withdraw from the Imperial City in 4E 174 was bloodily vindicated.
Lord Naarifin was kept alive for thirty-three days, hanging from the White-Gold tower. It is not recorded where his body was buried, if it was buried at all. Once source claims he was carried off by a winged http://www.uesp.net/wiki/Skyrim:Daedra on the thirty-fourth day." - UESP - The Great War
They did not "put them into submission"... the Empire retook their land, however both sides were weakened; the signing of the White-Gold Concordat was just as much to save the Dominion as it was the Empire. If the Dominion had "put them into submission" then they would be in control of the empire. I don't think you understand the concept of a Concordat, it holds a mutual benefit for both parties.