I agree with several of your points, but there are nuances here.
1. Offense getting worse doesn't hurt the defense: True, but Lebby's brand of hurry-up to get 3-and-outs does hurt defenses. Plus, OU's explosive offense's under Riley also put pressure on opposing offenses to score. Riley purposely slowed his offense down to protect his defense.
2. "needs more time to install his defense": Also agree! But Venable's defense is very complex. He, like Saban, has many calls and wants to get to the perfect call. That said, why hasn't he simplified his defense and calls to come to his players level?
Also, let's remember, this is going downhill. The OU defense performance vs K-St was at least partially Adrian Martinez playing the game of his life. Venables response do this was to rip into his defense and create more physical practices. BAD IDEA that shows he lacks a basic understanding of psychology. The last 2 weeks have been the give up periods vs offenses that are increasing in proficiency.
3. "Gabriel isn’t an elite QB...I’ll cut them a little slack there.": Also agree that Gabriel's performance on 3rd down specifically vs K-St was the difference between OU winning and losing (there were several other ways for OU to win that game, but this is one). But I don't cut OU's offensive staff any slack for having NO BACK UP AT ALL READY to play. If there were such a huge drop off from Gabriel the other guys, the other guys should've played more during the 3 non-con blowouts. They should've had packages tailored for them specifically.