Since when is Naruto a weakling? And why shouldn't he be able to battle the Kyuubi considering its not a physical battle, but a spirit battle INSIDE of Naruto in which only half of the Kyuubi's chakra is sealed? If this is Naruto's world, the Kyuubi is only at half chakra, and it is probably further weakened from having been sealed for the past 17 years, then I don't see any reason why he can't put up a fight with the Kyuubi.
He has done giant rasengans before. This one was just bigger because he used sage mode this time.
You're confused by his mother showing up? That's called a cliffhanger. The explanation comes later. You're supposed to wonder about it until then.
If you think this is ridiculous, then I wouldn't recommend you read Bleach.