I agree that Izanami is a completely stupid jutsu that kishi pulled out of his ass but how else was he going to have Itachi make Kabuto end the edo tensei? Talk no jutsu? He's probably tired of hearing people say he uses the talk no jutsu too much.
As for Kabuto, he's stuck in Izanami until he accepts his true self, at which time he will be a completely different Kabuto and not the Kabuto we know. If he does get out of Izanami I don't see him joining back up with Orochimaru, and i don't see him joining up with the people in Konoha either. I can't imagine what kind of role he would play, so if we do end up seeing him again, i have no idea why it will be.