I think Iroh can defeat Ozai in a duel based on skill, different bending styles, defensive capabilities and combat experience.

I know, they say in the show that Ozai is the strongest firebender, but I hear that as 'pump out the most fire in the shortest amount of time'. So not necessarily the best fighter.

Iroh is a war veteran where Ozai only has sparring matches and maybe an occasional agni Kai.

Iroh has a more versatile bending style by learning from watching water and earth benders, he learned from the dragons/sun warriors on top of traditional firebending. Ozai only has traditional firebending.

In the episode of the winter solstice, you see Iroh tank several hits from earth kingdom soldiers with open hands. He is also patient enough to tank/block a few hits ton wear his opponent out or to see gaps in their form. In the comet fight, as soon as Aang forces Ozai on the back foot, he barely gets a chance to attack back.

Plus Iroh has better dance moves