wrote:
that sludge is anaerobic, and anaerobic digestion releases hydrogen
sulfide H2S, which when combined with water is sulfuric acid H2SO4 ...
an acid. Nitrogen is released, bubbles rise to the surface and leave
the pond.

H2S is an acid all by itself, without any need to react with water.
it's SO3 which reacts with water to produce H2SO4. The conversion of
H2S to SO3 is an oxidation reaction, which won't be happening in the
anaerobic areas of your pond. Also, where is the Nitrogen coming from?