Gaara is somehow immune to genjutsu now? Gaara can't fly really, he can only levitate using sand, so you know he isn't going anywhere fast on that cloud of sand. So the Totsuka sword could easily seal him while he is just standing there. Because I don't know if you have noticed but Gaara doesn't really move when he fights.
Secondly he can't pull Itachi out of Susanoo, that was possible ONLY because of Onoki.
Third, where are you getting this idea that Itachi's genjutsu is short range? It's only limitations are your eyesight, as he can catch you in it just by you looking at him. So if Gaara can see Itachi, he can get caught in his genjutsu.
So hopefully my point is made. Gaara never moves when he fights, and he definitely does not have the capabilities to move quickly while on his sand cloud. Also if he can see Itachi he can get caught in a genjutsu. So your points are all moot and Gaara still loses.
By the way, I am really hating this underrating of Itachi going on. He is top 10 material easy and most likely top 5. Nagato - Itachi - Minato are in a class of their own, with only Tobi and Edo Madara surpassing them and Naruto and Sasuke not far behind.