Suetonius is heavily suspect, especially when talking about Nero and (even moreso) Caligula, but we shouldn't write him off completely. He did have access to imperial records from his time as an insider.Suetonius (the historian, author of The 12 Caesars) wasn't exactly an unbiased source. His stuff compares to Tacitus like the National Enquirer to the New York Times; a grain of truth pumped up for the sake of scandal. As far as he was concerned anyone who wasn't Trajan and conquering everything in sight or Augustus was a washout and Nero was far from Suetonius' favorite.
Roman manpower was less of an issue than you might think. Augustus used some slaves for the Illyrian revolt, yes, but that was because Roman manpower had not fully recovered from all of the civil wars yet.
I agree that Roman manpower wasn't much of a problem after this time. But Dio should not be overlooked when he says Augustus had little to no ability to replace the lost legions. I also agree that Teutoburg is held to be more important than it actually was. If you want to point to an event that caused Rome to withdrawal from Germania, it's the Great Illyrian Revolt (which was what led Ariminius to return to Germania and contemplate his own revolt in the first place) rather than Teutoburg.