I must have gotten something mixed up... isn't a coinbase a fee that the miner gets payed just for mining the block? He could really mine a block with only his coinbase transactions... basically he can decide not to include any additional transactions?
Yes. There is only one coinbase transaction per block. The coinbase transaction includes the payout for the block subsidy and the sum of the transaction fees in the block.
If so, then any other transaction he includes in his new generated block can make him money OUTPUT_1_amount - OUTPUT_2_change = transaction fee.
The transaction fee is the input amount - output amount.
So by mining a block he gets a coinbase amount (reward) + all of the transaction fees. So he broadcasts the message that he mined it... block is on the blockchain...transactions are considered valid...
The miner broadcasts the block itself. He doesn't just say that a block was mined. Miners also do not dictate what transactions are valid; a miner could include an invalid transaction in a block and the block would be rejected by all other full nodes on the network.