The game designers didn't decide on it because they can't. One dev that was resposible for some of the metaphysical lore asked this very question.
Concerning the metaphysical jive surrounding Dagon, I doubt he'd become the new Akatosh, especially if you meant King as in "Emperor" and not king as in "person who has control of Tamriel;" Emperors are High Priests of Akatosh. Also, Dagon is supposed to destroy the hell outta Nirn, so I don't know how a king would handle that.
Hell, if you wanna get deep - if you wanna get DEEP
DEEP DEEP - Aka already IS Dagon! Go check your Hinduism.
At the risk of sounding pretentious, it seems you might be trying too hard to search for sources that give you objective answers; I'll go ahead and tell you that you won't. You need to just sit awhile, read, reread, then reread some more of the lore, thought it seems like you're already doing this
.
Concerning five corners of the world:
Probably the most obvious way to interpret this is to go "the cardinal directions, then Up, right?" While i've never seen an objective answer for this, I'll give you MY take on it:
Numerologically speaking, 5 is a number of totality and divine perfection: humans have 2 arms and 2 legs and a head (when you stretch out your limbs, you form a pentagon, stars have 5 points, stars are considered gods, blah blah blah (ask if i need to elaborate on this.). Theoretically speaking, there are 5 dimensions of our world, the 3 dimensions of space, the 4th of time, and the 5th, which can be considered All Possibility, that is, EVERYTHING.
I think the 5 corners are 5 dimensions.
edit: Oh yeah, and I'm personally confident the Incalculable Effort is Love. When you start reading more of the Sermons, you'll notice the repetition of motifs and ideas you've read in past Sermons. Cross-reference information inside the Sermons to help you understand it more, e.g. the Incalculable Effort is mention later on in the sermons in the Scripture of Love.