--though sorry for the situation that brought you here.
Just casually looking through what you wrote, you do seem to have a pretty good grasp of the situation to me. I don't see anything in your report that screams "fusion now", and getting a second, or even third, opinion is a good idea. Much of what your reported is fairly common with aging and normal wear and tear, especially if you have an active or athletic history. On the other hand, only you know how much pain/discomfort you are in, and it is true that imaging studies, MRI or otherwise, do not always correlate exactly with symptoms--what looks mild and "normal for aging" there may be producing symptoms that seem out of proportion.
A laminectomy, or even a foraminotomy at that L5 level, may be a more appropriate procedure, but you do really need another opinion and maybe another high-tesla/high resolution MRI to gauge what's going on there at this moment.
I also would like to recommend you post in our Spinal forum to tap the expertise of that batch of people:
http://neurotalk.psychcentral.com/forum22.html