Obito is fearless, the only thing kid Obito feared was solitude/loneliness as stated by adult Obito , and he overcame it.
Whats the worse Itachi can do to him? kill him*? lol Obito never feared death, he already believed that he was in hell.
Obito is actually the bravest person in this whole manga, since he stood against the whole ninja world alone unlike Edos, Obito had no regard even for himself,much less his life. Stating that he is No One and does not want to be anyone.
Hell, even in his most weakened state, he stood next to Jin Madara and gave him the middle finger.
He had nothing to protect, nothing to live for and nothing to fear. A man who does not fear death, does not fear anything. so your whole theory falls flat.
And i won't even go into fighting prowess where Obito simply demolishes Itachi in every aspect.
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The very fact that Obito could've used the whole Akatsuki to gang up on konoha anytime and burn it to the ashes and anyone protecting it(itachi). Just shows that it was not done due to plot progression, nothing else.
*in his dreams