Now, imagine if the real Satoshi's identity is found. If he/she is still alive, governments would be on his/her tail to put him/her in jail or even pay a hefty sum of taxes. Once this happens, Bitcoin might fail within the mainstream world. Of course, the community is what makes Bitcoin great. But I'm sure that the reveal of Satoshi's identity will have an influence (either positive or negative) over the cryptocurrency's price and reputation worldwide.
That sounds funny. How could Satoshi have to be jailed for taxes? lol He created the Blockchain and Bitcoin ecosystems to make it easier for everyone to transact and store assets in digital form. Indirectly, he even changed the lives of many people from Bitcoin.
What are the odds of Bitcoin's survival once Satoshi is found? Will it continue to operate as is? Or will it fail in the long run?

Bitcoin will continue to survive even if this happens. All the technology in it is something that will make Bitcoin survive. Of course, with the development of the existing utility.