I have to disagree with your estimation that GSP was not dominating against BJ Penn. If you rewatch the fight GSP came out tense and nervous because he knew this was his shot at the title. Because he was tense he paid for it in the first round dearly. He also took an eye poke which I've replayed in slow motion over 20 times and IMO looks intensional without being obvious. Basically GSP was not in his normal frame of mind in round 1 which he will not make the mistake of doing again.
From that point on he dominated Penn in every way possible both standing and on the ground. As the fight went on he became more and more confident. The only reason BJ did not look like he's been beat up is due to his heritage. His skin type is extremely hard to damage. Look at how long Matt huges bludgeoned his face and he barely looked bruised with a few minor splits. Anyone else would have looked like an eggplant.