Solid post JustTool, my respect for you just balooned considerably. You can contribute so much to this forum if you post like this instead of being negative and pessimistic all the time and abusing other posters. Well done.
Now, addressing the (very valid) issues that you brought up.
1) Playing 5 bowlers
Eventually, we might have to play 5 bowlers to compete with the likes of Australia and England. Yet, we can only afford to do that if we can count on the top 6 (not just Dravid) to perform consistently with the bat. With Tendulkar out of form, Sehwag out of form AND shape and Dhoni inexperienced, facing the likes of Flintoff and Hoggard, we can't afford to go in with 5 bowlers. Sooner or later, we had to figure this out, and we learnt our lesson (hopefully) the hard way. Honestly, would we have missed Chawla or Pathan with the ball in the 2nd and 3rd tests, respectively? Quantity will not cover up for quality ... things are looking better now with the emergence of Munaf and Sreesanth.
2) Dropping players who lack the discipline for Test Cricket (ie Dhoni)
Dhoni should really get punished somehow for that idiotic shot. Still, he showed a great deal of application in the 1st innings, so the verdict on his discipline is not clear yet. He should get the message but be persisted with for at least one series. Let Dinesh Karthik and Parthiv Patel provide some pressure now.
3) Kaif is more suited to Test Cricket than Yuvraj
Again, how can you ignore Yuvraj's knock in the 3rd Test against Pakistan? I'm also a big fan of Kaif because of the application and work ethic he shows, but a talent like Yuvraj can't be ruled out so quickly. He's shown way too much promise. Let's see how much he learns and how well he does against the likes of Edwards, Bradshaw, Pollock, Nel and Ntini.
4) Aakash Chopra
Let's be realistic. Chopra was a solid grinder when he opened for India, but his being called up isn't likely at all. He wasn't even selected for the North Zone Duleep Trophy squad this year, a national call-up is far off I would think. Jaffer and Gambhir are not bad options and Gambhir is a good close-in fielder. Now, I'm genuinely hoping that Cheteshwar Pujara develops very rapidly and happens to be a short-leg fielder. Dheeraj Jadhav is also a rather defensive batsman who can apparently stay at the crease for long periods of time, not sure where he fields though. Give Jaffer a run with Gambhir on his tail.
5) Sehwag's laziness, poor fitness, indiscipline
Sehwag's poor technique was exposed by Hoggard and co. and he seemed to make decent adjustments at Mohali; he needs to work things out if he wants to have any success with top-class bowling attacks. He is terribly out of shape and something really needs to be done about that. Unless he scores a century every match, I don't want a man with a protruding belly despite being "one for the future" (only 27) in the field. If he improves his fitness, he shouldn't be dropped yet, let's see what he does overseas in the near future. If he doesn't improve his fitness, take him out of action and give him a strict fitness regimen to follow (which honestly should be going on right now with Ian Frazier anyways...).
6) Dropped players must perform before being selected again
Obviously, and this hasn't been too much of a problem in my opinion. Zaheer was brought back after impressive domestic performances and still managed to disappoint. Ganguly's was an exceptional case which will defy reason and logic in many aspects simply because it was a controversy poorly handled and resulted in a disaster.
7) Drop Tendulkar just like Ganguly was dropped
The final time Ganguly was dropped, it was more because he had become a distraction to the team than because he wasn't good enough to bat for India in test matches. In one-dayers he's too slow and indisciplined in the field, but purely based on performance, he did well enough in Pakistan to stay in the test side. Tendulkar was really starting to come under fire but now he's helped the selectors out by having this shoulder injury and operation. Hopefully he can find form again after that, but I'm not sure we can waste the precious remaining moments of his career on the domestic circuit. Just pray that he strikes form after his recovery and bats like the champion he is before he can call it a day.
8) Make Kumble vice-captain, not Sehwag or Yuvraj
Not a big issue, but yes he does deserve to be the vice-captain. Dravid is a real fighter, but Kumble is probably even more of a figher than Dravid ... now that says a lot. Consider Kaif as well, if he becomes a regular.
9) Hold Greg accountable
Yes, bring him to cricketweb. People here know so much more about cricket than most others in the world do. Especially those selectors.
TEAM INDIA
Jaffer
Sehwag / Gambhir (subject to the former's fitness)
Dravid*
Laxman
Yuvraj
Kaif / Raina / bowler (Kaif for now, if he struggles -> Raina, if the top 5 produce consistently against the Proteas attack -> bowler)
Dhoni+ / Karthik / Patel (Dhoni for now, more rashness -> Karthik/Patel, hopefully they are in good touch)
Pathan / Harbhajan / Powar (Pathan overseas, turning track -> Harbhajan, Bhajji loses form again -> Powar)
Kumble
Sreesanth
Munaf