Tobirama beat Izuna, Madara's equal and an MS user.
Couple things here.
1. Itachi was lying to Sasuke in that story; we can't surely separate truth from lie.
2. We don't have any clue where Mangekyō Madara stood.
3. We don't know the full circumstances of Tobirama beating Izuna.
He's also confident in beating EMS Madara and Hashirama never questioned Tobirama's ability to do so.
Madara, on the other hand, doesn't think much of Tobirama and Hashirama subdued Tobirama with a chakra-flex.
Hiruzen is the most hype in the manga, besides Hashirama and Madara.
And Itachi.
He knows all the jutsus in Konoha, he's superior to all of the Hokage and Gokage (except possibly Hashirama)
1. According to Iruka, he was the strongest Hokage. That's decisively incorrect.
2. According to the common folk, he was the strongest Gokage, but Itachi's stronger than any of the Gokage.
you need the 8th and final gate to surpass him
The 7th Gate wouldn't beat Itachi.
he could had beaten a 100% Orochimaru + Edo Tensei if he were still just 60, etc.
Orochimaru would sooner fight Hiruzen then than he would face 17 year old Itachi though.
Not to mention Orochimaru said that if he had Itachi, there would have been zero problems with Hiruzen or Konoha.
Hanzo beat the young Sannin
They were much, much weaker back then though. Tsunade didn't have her seal. Orochimaru didn't have his kinjutsu.
Jiraiya might have had Fukasaku/Shima, but he didn't seemed to have summoned them in the flashback.
.
and could had beaten Pein.
Where was this stated? He might have given Pain a good fight, but beat him? Doubt it.
His tools are also overhyped
Overhyped by the databook and manga.
and others have keen perception in battle too.
Still, it's hyped in the manga to be better than any Uchiha and comparable to soul-reading.
That's an iffy slope you're riding there. Most high level shinobi possess some hax jutsus, genjutsu is something that Kishimoto only uses for shock value and is highly debatable,
Sure, but think about it. Itachi is arguably hyped to be the most skilled in genjutsu.
He's hyped to have some of the most powerful ninjutsu, not just Amaterasu, but legendary items.
And his taijutsu/weapons, well, I'll address that next:
all ninjas can hit bullseyes with kunai
Kabuto distinguished Itachi's projectile-skills as being too damn good and basically top tier.
and I disagree about Itachi having any superior taijutsu feats.
Not many ninja can hang with Killer Bee, Naruto, etc.
Itachi is powerful, but power can be subjective.
Indeed, which is more or less the argument of the OP.