To get a dominion back, you have to completely annex it and release it again, unless that dominion is of an annexable size that would take a long time.
No, you are 100% wrong. Satellite status was something you could ask for in Vic 1 and there has been absolutely nothing in the dev diaries to suggest that you would not be able to make satelliting the nation one of your war goals.
Satelliting was something you could do to even a large European nation in one war so I really think you need to stop throwing your toys out of the pram and trust the devs on this one.