The time period in which the treaty was negotiated should probably be looked at when comparing it to history. The treaty was signed based on an armistice signed in 2367.
Its entirely possible that the Federation looked weak in the treaty as many Admirals pointed out to Picard that the Federation could not cope with another sustained conflict so soon after the events of Wolf 359
. So, the Federation may have pushed for peace and the Cardassian Union was more than happy take it since they likely wouldn't have won that conflict and probably knew it.
What recent and demoralizing massacares had the Brits suffered when Chamberlain made his consessions to Nazi Germany?