In some way, it does make sense.
It was a shit path for Oda to take Harald down on, but having decided on it, there are ways to make it "logical"-ish.
If only Harald + Xebec + those 2 specific DFs can make a difference against IMU, and with Xebec dead, Harald can't think of anyone else strong enough to replace him, then kneeling to IMU is the smartest choice, especially if he cares about his (dumb) people.
Plus, Harald seems to be wanting to atone for the giants' own historical crimes. He might've found out a repeating pattern: maybe in Nika times, the giants were the enslavers & genocide-perpetrators helped by their unmatched sizes.
Still, imo, the best course would've been to have Xebec and Harald execute their Perfect Plan together, keeping some elements of it in the dark for us readers, and have IMU beat them with some underhanded tactic besides DRing their allies.
But ya can't expect strategy from OP, so that's that.