There was certainly no alternative to signing the peace terms. According to Scott Christianson, Fatal Airs, pp. 38-41, the Allies were preparing to bomb German cities with poison chemicals when the war ended. No valid purpose would have been served by prolonging what was clearly a lost war. The way that shysters like Hindenburg, Hitler and Ludendorff subsequently tried to pretend that they knew what to do better was all a fake act.
The chance for a German victory was lost when Ludendorff's Spring offensive narrowly failed to split the junction between the French Army and the British Expeditionary Force, which would have left the French falling back to defend Paris and the BEF falling back onto the Channel ports. This would not have won the war but it would have put the Germans into a very good bargaining position ─ even with fresh American forces arriving to plug the gaps.
In November of 1918, the Allied armies had a long way to go, and the prospect of fighting yard-by-yard to Berlin was not a very welcome one. Unfortunately, "every third German was a traitor," as the Allied expression went, and the traitors were not interested in negotiating any kind of lasting peace other than imposing world revolution.
You say that the Allied bombers were ready to win the war with poison gas bombs.
The reason that poison gas has not been used in warfare, generally speaking, is because it was found to not be decisive in combat during the First World War when it was used extensively. Hitler and the German General Staff agreed on this point, and only stockpiled it as a deterrent just in case.
Even with respect to the new German nerve gases, manufactured and stockpiled in large amounts, which Dr. Goebbels was hoping would be used to avert the catastrophe of German defeat, the experts could not guarantee to Hitler's satisfaction that the enemy had not already developed other chemical weapons ─ and perhaps even better ones than the secret German nerve agents.
In the event, the British had been able to weaponize Anthrax during WWII, but like the German nerve gases, this was never used.
The American Senate did not ratify the 1925 treaty banning the use of Poison Gas in warfare, but early in World War II, the American government did make a no-first-use pledge regarding war gases. And this may have served the Germans in good stead, because although Churchill called for "drenching" Germany in poison gas, the Germans had far less access to ethylene petrochemical feedstocks to produce Mustard Gas, so even in retaliation, their chemical weapons production would have been far diminished in comparison with the Allies. Germany also had critical shortages of proper medicines and antibiotics to deal with something like Anthrax attacks. The Allied gas masks would not have been effective against the German nerve agents initially, but that would have been rectified quickly.
As far as strategic air attacks in World War I, that is overrated as well.
According to aviation historian Col. Walter J. Boyne (1929-2020), there were about 746 Germans killed and 1,414 British killed from aerial bombardments during the First World War, mostly from German Gotha bombers, and British Handley-Page attacks upon Cologne.
The first 1915 German Zeppelin attack against military barracks was notable but did not yield much in the way of results other than the death of a London policewoman.
The German Zeppelin attacks did, however, generate a huge panic and a political outcry ─ but in the end Schrecklichkeit or Shock-n-Awe has to backed up with convincing force or it has no dominance and value for deterrence.
In The Influence of Airpower upon History (2003), which I reviewed for Germar Rudolf's fledgling Revisionist Journal in 2004, Col. Boyne describes how the Germans and the British walked away from their experiences in the First World War with completely different opinions on the importance of strategic bombing.
The Germans regarded the WWI British bombing sorties on Cologne about like the "Five O'Clock Charlie" raids from the 1970s Korean War TV show M*A*S*H, which were reminiscent of the Imperial Japanese aerial sorties upon Chungking during World War II. Contrary to Churchill, History has seldom shown that imposing "Democracy from above" has any lasting results.
British Munitions Secretary (Air Board President) Sir William Weir said:
“I would very much like it if you could start up a really big fire in one of the German towns. If I were you, I would not be too exacting as regards accuracy in bombing railway stations in the middle of towns. The German is susceptible to bloodiness, and I would not mind a few accidents due to inaccuracy.”
~ Letter to Marshal Sir Hugh M. "Boom" Trenchard, Father of the Royal Air Force, 10 SEP 1918.
WWI GERMAN AIR RAIDS
103 total raids, inc. Zeppelins 7,776 bombs dropped 1,414 killed 3,416 injured $ 14,675,000 damage
WWI BRITISH AIR RAIDS
675 total raids, inc. 446 at night 14,208 bombs dropped 746 killed 1,843 injured $ 6M damage