All very good points, Schoonerbumm!
I will make just a couple last points about Midway, and then leave it alone (everybody gets to have their own opinion in a 'what if' contest!).
It is important to remember that most, if not all the references that have been quoted by various members were written by Americans after the war, not Japanese, and not by actual participants. Therefore, most of this stuff is heavily laced with a lot of self-righteous propaganda that conveniently ignores an awful lot of facts. As what I have proposed appears to be controversial (at least!), it might worth remembering that this proposition was developed using Japanese sources, as well as American sources, and by participants, not after-the-fact academics. As you might imagine, the picture is very different! Two excellent sources are 'The Reluctant Admiral' by Hiroki Agawa (a Japanese Intelligence officer in WW2), and 'Japanese Destroyer Captain,' by Tameichi Hara (a destroyer Captain throughout the Pacific war with a lot of good points to make about how operations were conducted).
These two books, along with a number of others, illustrate most of the points I have been trying to make; Yamamoto knew Japan could not fight a long war with the US, and argued very strongly against any such undertaking. But once he had been over-ruled by the Army, he came up with the best plan he could. And it was quite a good plan! But for some reason (and I have speculated that espionage and sabotage had a large part in this), he did not follow his own plans, which ensured they would fail.
Both Pearl Harbor and Midway are classic examples of this failure, intended or not. It is important when looking at Midway not to look at this battle in isolation. Yes, the loss of three US carriers and a few thousand men by itself would not have 'knocked the US out of the war.' But that position ignores all that had led up to that point, with the fall of Singapore, the fall of the Phillipines, and the huge losses that entailed. The loss of Java, Malaysia, Thailand, Indonesia, etc, etc, the destruction of the ABDA naval forces, and on and on, and all within just a few months meant cumulative losses to the US and the allies of tens of thousands of soldiers, sailors and airmen, dozens of ships (including a number of carriers and battleships), hundreds and hundreds of aircraft, and at the same time, the Germans were rampaging all over Europe, North Africa and the Med. While the Coral Sea action gave a bit of encouragement, it was purchased at terrible cost, and one more big loss might well have been catastrophic for allied morale in the Pacific.
Yes, the US was cranking out carriers and other ships as fast as possible, but to divert all of these, or even the major portion to an apparently losing campaign in the Pacific, when the Atlantic convoys were critical for the survival of not just the UK, but the Soviet Union as well, begs the question of what might have resulted in Europe if this did in fact happen. The loss of the US carriers at Midway could have led to Hawaii becoming rapidly untenable for US logistics, as once such things as docks, machine shops, cranes, etc are destroyed, it is pretty easy to prevent them from being rebuilt. And without Hawaii, and without the Panama canal, the logistics behind putting an American fleet in combat operations in the Pacific becomes tenuous in the extreme, if not impossible. In fact, there is a very good argument that without the facilities at Pearl Harbor, most of the US ships that were damaged in the various battles would never have returned to fight another day.
All this points to a very grim conclusion, and that is the political pressures to sign up to at least a temporary peace with Japan would have been enormous if Midway had been lost (and that pressure would have been applied not just by elements within the US government, but by our allies as well). At the end of the day, the rationalisation goes something like this; None of the territories lost in the Pacific could be truly considered 'US soil,' so just what have we actually 'lost' here? Politicians are generally pragmatic, and (as you should understand by now!) can rationalize and spin just about anything to make it look favorable, and usually do (and the same goes for many academics, I might add!). Roosevelt and Churchill gave away Eastern Europe to the Soviets, when it was convenient and necessary to do so, and under the right circumstances, a temporary peace or ceasefire with the Japanese was well within possibility, given another huge loss..... Here endeth the lesson.......