Isn't a victory over Charlemagne rather difficult? And control over the whole of Jutland is going to likely lead to conflict with Norse powers, I also think you are over simplifying the conquest of the low countries.
It is difficult if he is alive and well, but a substantial injury or even death would end that. Charlemagne's sons wouldn't come of age until the 790s or so, and the regency beforehand would provide a good political climate to scare the Franks away.
Just have a weak but equally aggressive Frankish leader (don`t need Charlemagne) and an early alt-Widukind leading the opposition.
Widukind was a noble, possibly a descendant of Theodoric (who fought Martel in the 730s), so he would be an easy pick for leading the resistance, especially once he proves himself as a capable commander.
The expansion only works the way you describe it if these Saxons establish some sort of overlordship over the Vikings, or some form of shared / dual polity, which could include more and more of England, too. A loose North Sea dominion of sorts - but one with a large landbase and manpower reservoir.
Could make for horrendous alt-Viking conquests.
Saxony in 771 had a pretty good relationship with the Danes to their immediate north (one of the leading Viking powers), and this was only changed by Saxony getting invaded and destroyed. If Charlemagne is killed in battle and Saxony holds its own, an alliance between the two powers would be quite possible, especially once the Vikings start invading everything.
We know that the later Karling rulers weren't especially good (notably excepting Charles the Bald, but I doubt he is born in this TL), and having that trend apply here is quite reasonable. By the 860s West Francia was pretty badly devastated by the raiding, which would make it easy for Saxony (with a decent leader) to take parts of it over. Especially so if the Great Heathen Army attacks there instead, for whatever reason.
After a Saxon state has established itself in modern Benelux, all it needs to do is convert to Christianity (do this while the Vikings are distracted and/or collapsing) and it will likely be a major power, certainly strong enough to take over the eastern territories (remember, Poland only formed in the 960s). While it may take a few more centuries to reach the size the OP wanted, they would be well in a position to do so.
- BNC