Yes, but that was more due to Gord Simmonds being a cheapa** owner--he never wanted the team in Belleville, and basically waited a decade until the Habs left Hamilton, and the OHL became open again for the city. He ran that team to the ground.
Considering how difficult it has been to build support for the Bulldogs in the OHL--it is questionable if its fanbase will tolerate a rebuild, which this team is heading straight towards.
Also not helping is the city council's apathy towards a new arena the team desperately needs to keep the team in the city beyond 2018-19 (I'm assuming they will be in Hamilton next year)--but like Mississauga, after that is dependent on a new lease, and for Hamilton's case, a new arena, because Andlauer wants a new arena plan ASAP so they can be in a new arena by the time the OHL's turn for the Memorial Cup comes in 2021, when they will likely bid again, when the Bulldogs will likely be an elite team again after the coming rebuild. He has already said he cannot wait 5-10 years for a new arena when FirstOntario is showing serious aging problems.
Your first point is abjectly absurd, if only because of the timeline
2004 - Simmonds buys the Bulls and immediately communicates a need for renovations.
2004 - Michael Andlauer purchases the AHL Hamilton Bulldogs from a local ownership consortium
So...Simmonds immediately buys the Bulls, expected the city of Belleville to not perform arena rennovations, expected Andlauer (who just bought the Habs affiliated Bulldogs and has been a longtime Habs fan and part owner of the Canadiens) would have to sell the team and buy his OHL team (despite no disucssions about an arena in Laval having occured until 2010) and intentionally cheaped out, tanked losses for a decade and frequently requested arena renos from Belleville, all so he could sell a majority stake in the team to Andlauer. It's ridiculous.
As far as building support, the Bulldogs are the 6th best attended team in the OHL after three seasons of exsistance. I have no doubt attendance will suffer a bit if they become a bottom feeding team, but even if they are middle of the pack sellers next season (like London this year) I doubt that's going to cause a massive exodus. This isn't Flint who after a few seasons of exsistance and a new facility dropped a coaching bomb, haven't performed are now 3rd worst in the league. Also Andlauer is now seeing additional revenue from making the playoffs.
As far as the arena, that is a different dicussion all together, from my understanding though the city is trying to make a land swap with developers to finance a build. I don't know how successful that will be, but it's still an attempt. That all said, I will agree a new arena or a major hockey oriented reno to First Ontario needs to happen this decade.
Regardless though, apart from Simmonds being cheap (and having a relationship with Burnett) there is little in the way of evidence to support Gruden being let go after winning the top seed this year. If Stan Butler and Bob Jones can also stick around, there is little reason to think Gruden is on his way out. If anything, I'd be concerned about an AHL team calling.