I don't disagree with you T'Girl. From what I read in Piller's book "Fade In", I always assumed Picard being put in his place and threatend being stripped of his command was the intention in INS but it never happened. I don't think StarFleet or the Federation Council is above saying or doing these things but things not shown or said on screen are as as good as it never happening.
Picard is the captain of the flagship but we've seen in TNG "Chain of Command" that the ship can be changed over to another captain quite easily. But it could have been written in a way that Picard either swallows this pill and follows orders or gets drummed out of Starfleet. With all the dirty and ugly things Starfleet did to win the Dominion War, we can imagine Picard would rather stay and make any actions the ENT and crew commit to his decisions rather than pass the buck to the next obscure captain they have waiting to command a ship.
Also I really wish they did something with Riker and Data taking command of ships in the Dominion War. It was appropriate in TNG "Redemption". Why not repeat that?