(SPOILER)The Concordat was accepted because the only other option was absolute destruction, which wouldn't help anyone in the Empire. The Thalmor would have taken Cyrodiil and would be attacking Skyrim from two sides. Skyrim would fall, lots of people would die. Emperor Titus II, a pretty cool guy, knew this so accepted the terms with the intention of rebuilding their strength and launching a massive counterattack, then Ulfric Stormtwat ((SPOILER)an unwitting pawn of the Dominion, specifically installed so as to destabilise the Empire and make everyone more easy to take over after the civil war) gets in a huff and ruins everything.