I agree with some of your points of view

I personally think that Cid and Louisoix DID know but somehow they had hope that it woudl be stopped. They held the info from us to avoid panic I gues..

And now, how will they explian ATOMOS? and that labrynth thingy... will Bahamut just chill there?
How is this this dungeon created etc etc.

Seems 5 years is very very few time. 50 years would be more appropriate IMO