Romania, Serbia, Russia and Italy, in this scenario, are pretty much all defeated (except maybe Italy, but they are in a bad spot anyways), so I don't see why they matter. If anything, Karl wanted peace with no territorial acquisitions, so A-H would give up all their gains for peace. This would be a very good deal if the Entente aren't able to reverse things in Italy or the Balkans, and they probably would think that restoring Serbia and Romania's independence would be the best they could get in that situation.
What's keeping then from backstabbing then after the war? Are you not aware of what happened when the Entente tried to intervene in Russia after the war? Everyone is massively exhausted from the war. With the war with Germany over, I can't see how it would be any different iTTL; why would anyone support a continuation of hostilities when Germany, the real threat, has been defeated? If the Reds still win in Russia, then a friendly A-H is a good geopolitical ally against a resurgent Germany that will absolutely despise A-H and Communist Russia. Plus, like
@Svetonius21 said, A-H was willing to support either an autonomous Poland or even an independent one under a Habsburg monarch. Pretty good deal for the Entente IMO given the circumstsnces.