I think you underestimate Reagan quite a bit there, AMBOMB. Reagan used a very efficient negotiating technique (both stick and carrot - Reagan was not as hardline in regards to the USSR as many people seem to think) and he used his considerable personal charm to negotiate quite often, which proved to be deceisive at several stages during his presidency.
Without Reagan at the helm the situation in Europe would no doubt be more explosive. Reagan had a steady hand and was personally essential to all the disarmament talks. The many flash points and situations during Reagan's presidency alone opens up for all kinds of butteflies if he is removed from the equation. Furthermore Reagan picked a few good men along the way, Schultz is one of them, that also proved important.
Andropov and Bush Sr actually met once, I think it was at Brezhnievs funeral, and Andropov did not think that much of Bush Sr.. Senior made a go at breaking the ice by commenting on their former service on opposing teams, so to say, and Andropov thought Bush was something of an amateur.
Regarding the economic state of the USSR and Gorbachev. There is no doubt the introduction of SDI made the Soviets aware that they might if not was going to lose the arms race. That alone gave the reformniks strenght and influence that they might not otherwise have had. Remember, it was not a given, that Gorbachev should come into power, far from it.
Reagan's rearmament programme and focus on high technology made it obvious for the Cardinals of Kremlin
) ) that reform was needed and needed now. Had another President been in the White House, history would have been very different indeed as the Soviets might, and probably would, have postponed real reforms and picked another General Secretary than Gorbachev which would have made the situation in Europe really, really interesting...
I've just read 1983 by Ramush Dahlberg and it gives an interesting view into these matters. A lot of us have these weird prejudices about that time, and quite often they just don't hold up...
Furthermore, Reagan gave American back its selfesteem and confidence, and while one might disagree with his politics, it is hard to argue with success: the world is still here and the US of A is its only superpower...
And Lennon?! Well, he and Yoko would most likely have been the worlds premier freakshow for a long time - had it not been blown up that is. And with Lennon still around with Yoko on backing vocal, then the 90's fascination of Beatles and their sound might never appear as it did OTL, which would mean no Brit Pop and thus a rather lame British muscial scene and perhaps even no Cool Britannia!
Best regards!
- B.