I agree with all of the premises you present except this:

"Here in the US real democracy is not currently possible because our capitalist economic system is incompatible with people’s democracy. It and the governing structures that support it must be completely removed for real democracy to exist."

Capitalism is compatible with democracy if we had a true democracy that served the people who elect it. That would mean a total revamp of our corporate law and our economic thought so that the government actually functioned as an extension of the people and with their best interest in mind foremost. It has the tools to do so, but much of our governmental structure would have to be abandoned or rewritten, starting with the Senate.

If the federal government, as the monopoly issuer of our nation's currency and the supreme regulator of commerce, used its sovereign currency "for the common welfare" as it is mandated in Article 1: Section 8, it could become the employer of last resort and insulate the people from much of the damage intentionally inflicted by the business cycle that greatly favors banking and the oligarchy. In such a position it could end the involuntary servitude of the working class while setting the floor for wages and benefits that employers would have to outbid to gain their workforce.

A properly regulated capitalist system that was totally independent of government's support could co-exist with a democratic government and provide for the growth and proper stewardship of our nation, but it could never again be allowed to influence the people's government. Drastic penalties, including capital when applicable, would have to be enacted to any attempt to do so to let the oligarchs know that the government belongs to the people and not just the wealthy and their corporations.