I agree with [MENTION=185335]Big Block[/MENTION] about water temperature.

And I'd probably soak the leather, or at least immerse it repeatedly; you will need a lot of water to soften it enough. If you want I can send you a pattern of what to cut.

That said, I don't think it's a good idea. You're basically trying to do two things; (1) forming a recess in the top is a variation on the"imperial" theme, and (2)cutting the sides and connecting remaining bit is the classic "swallow" treatment. I don't think you can imperialize it after you swallowize it, so if you want to do both, do the recess first.

To make the imperialesque recess, you will need pressure from both sides; the dowel you mention to press down, okay, but also a symmetrically placed pair underneath to support the edges. This is not going to be easy. The leather will have to become really really soft, and even so it will require a great deal of pressure. If the leather is at all compromised by age etc, it's going to tear.

If you can successfully imperialize your saddle, i suggest you let it dry and try riding it before attempting the next step. At least, that is how I would do it if i would do it; but honestly I wouldn't do it.