Reinforcing water damaged wooden fence posts, will it last, will it be strong enough?
The best fix is to replace the posts with new posts correctly set in concrete.  if you want very long-life use concrete posts.

I can't say if your steel post will be strong enough, because I don't know how strong you need it to be.

sheet-steel buttresses are used to reinforce rotting power poles, so your plan is not totally unprecedented.

You will probably need two bolts 500mm apart to hold the post well.  Given that the ground is likely to be soft near where the post is rotten I would go at-least half the height of the fence underground.

TLDR: disconnect the rails set the fence panels aside then rent a post hole digger and replace the posts, back-fill the holes with "instant concrete", dress the top of these foundations to slope away from the post.