Hammerfell is notoriously bad at getting along with Highrock, an alliance between them, in 4E 201, seems extremely unlikely.
Skyrim is not nearly as strong as Hammerfell. Even if the stormcloaks took over, we all know the Thalmor-led Dominion is stronger even than the Empire. And considering the current alliance with the Empire, they would just march through Cyrodiil, flatten Skyrim, and possibly destroy High Hrothgar, which is likely one of the towers. Highrock also, wouldn't stand a chance. It lacks strong leadership, and is mostly made up of warring families and houses. Getting the entirety of Highrock to ally with anyone would be a chore. Hammerfell also has two opposing factions, in the Crowns and the Forebears. But they, for the most part, are uniting against the Thalmor as a common enemy, which makes Hammerfell far stronger than either High Rock or Skyrim, and as they don't even share a religion with either, they have absolutely no reason to come to the aid of the weaker provinces. Hammerfell can hold it's own, and it doesn't need help.
Pertaining to the actual question, as has been said before, the Empire is only making the smart decision, and trying to rebuild their strength. Given enough time and enough peace, they could come back strong and actually face the Aldmeri. But they're the only chance Tamriel has. A Hammerfall-Highrock-Skyrim alliance wouldn't be effective enough or organized enough to actually cooridinate an offense. The Empire, as a unifing force, is the only chance of that. For Tamriel's sake, the Empire needs to survive, and it needs to thrive.
Ulfric is a fool. He can't see the bigger picture, and he's being petty and obstinate. Rupturing Skyrim during this time of crisis is the worst he could do for Skyrim's health and Tamriel's health as a whole. On the racism bit, he did welcome in the Dunmer refugees from Vvarydenfell, but at the same time, he treated them like second-class citizens.
You could actually draw a lot of parallels to Hitler. Both were great speakers, who roused their people behind the idea of unfair treatment, while at the same time oppressing another race.
And that's my piece.
