They would need to drop the "overlapping generation" teaching before they replace it with the Noah's flood generation.
I don't think so...they're all about "multiple lines of evidence" that point to the inexorable conclusion that the end of this system is going to come before xyz.
I do tend to agree on your second point - I think they almost need to have another great disappointment ala 1914 or 1975. That would allow them to shed the dead weight, monetize the newly empty KHs, and anyone who's currently on the fence but decides to stick around would have no choice but to double-down. I think the 1975 fiasco is a large part of why the current generation of JWs is so much more complacent than the previous one that lived through 1975. In order to stick around after they were exposed as false prophets, they had to really internalize the doctrine and convince themselves that they were more sure than ever before. Today's generation is able to just float along because they haven't made nearly as bold a (false) prediction since.