You make some good points, but I just wanted to mention two things:
One, the Empire didn't surrender. We actually turned the tide of the war and demolished the Dominion. But in tbe process we used all our men and resources. The Dominion was exhausted too, but they were so zealous and insane they were willing to keep going, so we were forced to sign a treaty with them. Contrary to what biased npcs tell you, the Dominion is likely struggling like the empire is.
Second, Ulfric DID duel Toryyg, but keep several things in mind. Ulfric hadn't tried negotiating with the high king. Npcs say that Toryyg admired Ulfric and likely would have listened to him if given the time. The High King also had no choice but to fight, else he'd have to give up the throne. Toryyg was considered a boy by Nord standards, barely an advlt, while Ulfric is a seasoned war veteran who uses game-breaking dragon magic. No High King could likely stand against him. Toryyg had no chance of winning, but he fought regardless because he believed in the empire. Ulfric waltzed in, didn't negotiate, challenged him, shouted him down and finished him off. So yes it was a fair duel, but what does this say about Ulfric? Sure Ulfric had the traditional right to kill the high king, but was he morally right?
In a sense, yes.
In the game, Ulfric told me that the Jarl's of Skyrim were once strong, decisive leaders and the High King was the strongest and most decisive. Ulfric then stated that many of the High King's of Skyrim were hand-picked by the Empire after a while, something which went against the old ways of course.
Was Torygg the strongest and most decisive Jarl of Skyrim? No. He was not.
Is Ulfric the strongest and most decisive Jarl of Skyrim? That's arguable. He DOES have the power of the Voice, which gives him a pretty large boost. He's also a war veteran, and managed to get the people to follow him, and has created a rebellion. In my mind - yes, Ulfric is indeed the strongest and most decisive Jarl of Skyrim.
I've also never once heard Ulfric mention he SHOULD be the High King... I do remember him saying something about Torygg's wife(Elisif?) being the High Queen, and that the Moot was not entirely agreed to promoting Ulfric to High King.
But to me, if Ulfric is the strongest and most decisive of the Jarls, he is indeed the rightful heir to the throne.
EDIT: As well, Ulfric plans to fight the Aldmeri Dominion. He says so. So he doesn't care about fighting the Empire - just wants to get them out of Skyrim. Once they're gone, Ulfric probably has nothing to do with the Empire, and would rather focus on fighting the Dominion.
If rebellion can defeat a weakened Empire, and a weakened Empire can manage to stand toe-to-toe with the Dominion, I think Skyrim and the Empire could crush the Empire.
Of course, I believe the Empire will fall.