You restrict MS, but not the Sharingan itself. A Genjutsu can still be cast via Sharingan and if a Genjutsu is cast via Sharingan, then it is possible Tsunade would have the will-power to overcome (The same as Orochimaru). The Sharingan is a powerful and useful tool used by Itachi and with its abilities could dodge almost every one of Tsunade attacks.
However, you still have to take en-account the healing abilities from Tsunade if any damage might come to harm.
I say Draw.
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Off-Topic: Was not really needed for a discussion, but I assist being that many Fans would try to overate a certain character or both at the matter.
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First of all i thought it was 1 vs 1 why bring in aid or are you not confident.
Itachi doesnt have any moves to attack her?. I agree his regular katons will do very little because sasuke even said such low rank fire techniques will not kill him and that obviously isnt killing somebody like tsunade.
Also Tsunade strength is something to be scared of but she isnt landing a hint. Sure when it comes to pure skill she has a 0.5 advantage over itachi in taijutsu but that is nothing. Not when your speed is 3. Itachi will dominate her in a taijutsu fight, her speed is so poor adding the sharigan which enhances itachi's reflexes isnt helping her because itachi doesnt need the sharigan to keep up with such speed. With his superior reflexes, speed, handspeed and taijutsu skill he will dominate tsunade is a taijutsu fight although this will be a waste of time because taijutsu isng kill her
But thats where genjutsu comes in. We saw what itachi did with a 3 tomoe sharigan against oro and cut his hand off. He can repeat the same feat and instead cut tsunade's head off. For all her medic prowess she isnt hidan, she isnt immortal. If you cut her head off she dies. Similarly he tricked diedora who nearly blew himself up
Izanami isnt even an ms technique although it isnt needed in such a fight
Bold: I see you go by the Data Book and-all, but your assumptions are a little bit biased sometimes. I wanted little parts, but the paragraph would do fine.
First off, you are correct about her Taijutsu. Tsunade's strength does not compare to Itachi's. You would say, or it is obvious, that her strength is above Itachi's. You also pointed out that her speed along with strength is also not on Itachi's level and even without Shringan could he could dominate the battle in any way. However, I think otherwise.
When in battle it sometimes hard to determine your opponents movements. In any situation the battle could change with one simple attack or distraction to Itachi. You say Itachi would not need Sharingan, but at any given moment or a slight of distraction could be his downfall. This could happen regardless of any Rank or Tittle. So, you saying he might not need Sharingan to fight Tsunade because of her speed tells me you underestimating her, especially with skills and experience on her belt.
Underline: Why result to Genjutsu when this is a battle of "Strength". I know Tsunade would win the battle, but you have doubts of Itachi losing (Not saying you are a Fan). What you are saying is that the strength of Tsunade is to much for Itachi to handle so he would use methods to paralysis her and then kill her. Not actual fighting, but still a battle.
However, in my opinion (or crazy speculation), I have thought of the semi-battle between Orochimaru and Itachi as it is a bit unnormal to Fans on Itachi's view or what ever (Again, not saying you are a Fan). It is true that Itachi use a Sharingan Genjutsu on Orochimaru, but it was with Orochimaru's will-power to overcome the Genjutsu. Itachi notice this and cut off his hand to prevent himself from releasing himself from the illusion.
Conclusion (My Opinion): Itachi knows not to underestimate the Sannin or Tsunade. He would be using his Sharingan.