You have;
Two provinces to the south that need to be secured, jungles and giant forests.
You have to make sure the Argonians don't plan to expand anymore, need to protect that border.
You don't have a full army, not even half an army left, so below half an army.
Hammerfell is occupied need to help your ally who is still your ally.
Every single city is burning, no farms would be up and running, need to feed your people.
Don't forget you need to supply your forces, since every city is in the crap hole, need to get smiths up and running.
Protection for the civilians, so roads to secure between cities so they can send supplies to each other to rebuild.
Need to place soldiers in towns because town guards would have been mostly wiped out.
Your ships also are mostly destroyed from the Naval battle in the river that surrounds the Imperial city.
Need to attack the Thalmor at the Summerset Isles who are defending their homeland now, so it'll be a battle for every inch, cities to take over, forts etc. Have to make sure you're supplied with reinforcements which would take quite sometime to get there since you have limited ships.
Khajiit accepts the challenge of Emperor, but Khajiit will continue his argument as Khajiit.
Ozan would abandon the province. It may seem harsh, but it will not be permanent. Escort the refugees to Skyrim, perhaps other places.. There is no need for protection against the Filthy Argonian as they have not tried expanding yet. There was a reason Morrowind was invaded, it was because they enslaved Khajiit and Argonian.
Instead, Ozan would seek an alliance, pointing out that though the Empire was invaded, they should guess whose next. No need for a navy when an army may breathe underwater.
Back to the cities and settlements of Cyrodiil. They would have no garrisons, but mannequins upon the wall, perhaps summoned Daedra to fight back the inevitable.
This shall only prove as a lure, however. Trap the cities. Boobytrap doors, rig cielings to fall, destroy the ENTIRE city if need be so long as the Aldmeri soldiers are caught in the rubble.
This is not to defeat them but scare them. Ozan's Colovian force would have to remember all the weapons of deceit because only two or three cities would try to be taken. This is winning a battle without having an army to do so.
Addressing Hammerfell, this would be the difficult part. The force remaining would be split, holding mountain passes at Skyrim to ensure invasion is impossible, ambushes are certainty.
The other half would be sent to join Redguard guerrillas.
All guards would have to be replaced with absolute militia, prisoners conscripted, and swords given to all.
The Aldmeri forces were destroyed in the Colovian city. This means it would take some time to prepare for another invasion. Remember the Argonian reminded about whose next? They fight as guerrillas as well. A blockade may be set up to ensure the surrounding waters of the Summerset Isles may not be safe. When a ship is boarded by the very sea, it is sure to sink.
However, this is assuming the Argonian would join. If they do not, spark rebellion, specifically in Elsweyr and Valenwood as both local peoples fight in shadows. War weariness burdens their hearts as well, and if Khajiit could be proven the Aldmeri lied, then the fire burns that much more.
Notice how Khajiit mentions no field armies? Field armies are slow and are only effective against other land armies. If Khajiit has no army, why would he be direct?
One must remember, a dagger in the dark strikes just as hard as a hammer in the sun.
