sorry, but that's just a poor argument and not up to your usual standards at all.
you based a hefty bit of your argument on the fact that itachi and kisame were not crapping their pants at the sight of jiraiya when they used nothing but respect when talking about him to each other.
first off, you contradicted yourself with the oonoki part. a person can show someone respect, like oonoki did, and believe they are out of their league, but still challenge them, even though they have little hope of succeeding. like kakashi did with orochimaru.
secondly, Orochimaru respected Hiruzen and recognised him as a superior opponent, as evidenced by his words to anko, to hiruzen, and the fact that he summoned two kage to help him out in the fight. That he mocked Hiruzen means absolutely nothing, villians are always cocky and arrogant.
which brings me to my main point. Why do you expect that Itachi, who faced Kirin and Chibaku tensei without batting an eyelid, would cower in fear at the sight of Jiraiya? It's just not going to happen. Even if he does regognise Jiraiya as a superior opponent, which I think he does, he is not going to show any emotion or fear. He turned his back to Jiraiya because Jiraiya allowed ~Sasuke to try and defeat Itachi. And because he had no intention of fighting Jiraiya in the first place, which is why he used Tsukuyomi so freely. But just because he never meant to fight, does not mean that his praise of Jiraiya is invalid.
Kisame, when has he ever shown any fear? He's probably the most proud and cocky Akatsuki, the only person who he shows great respect to is Itachi. He's made fun of Tobi, Deidara, the zombie bros, Gai,Asuma, Bee and everyone else he's met. It's his nature to make fun of his opponents. and again, there's no shinobi of that level who would run away like a chicken at the sight of a better opponent, except for Kabuto.
edit: while we're talking about confidence, Jiraiya was more than confident about taking on Itachi and Kisame at once. should we infer from that that Jiraiya>Kisame+Itachi?