There is no blockade against Cuba; every other country in the world does business with Castro.
If Cubans don't have Made-in-China toothbrushes or Made-in-China toilet seats is not because the Cuban government cannot buy those items in America.
The only blockade I have seen is against American companies by large retailers like Walmart and Target. As a matter of fact, I have tried to buy Made-in-USA toothbrushes and Made-in-USA toilet seats, and I cannot find any American products in Walmart or Target.
If there were no sanctions, if Juan working in Goodwrench was making $2 per hour and Jose working for Castro $15 a month, Castro's regime would topple like a deck of cards.
There is a little problem with your argument, since it has already been tried in Cuba and failed. There are many private companies that have invested in Cuba, and that did not help the Cuban economy; the US is not the only game in town. The foreign companies pay to the Cuban government the serfs' wages, and the serfs get paid whatever amount the Cuban government deems appropriate.
In your scenario, you seem to suggest that American companies will be able to hire any Cuban at will and pay Cuban workers better wages. Did I understand you correctly?
Furthermore, American companies have done plenty of business with Cuba; for instance, GM, not GM Detroit but GM anywhere else. Back in the 1970s and 1980s, GM Argentina supplied Cuba with a large taxi fleet. As a matter of fact, Chevy became almost synonym with taxi in Cuban slang. Did that improve the economic condition of the people?
In the Bible, there an Egyptian king that dreams about fat cows and scrawny cows. Even after devouring the fat cows, the scrawny cows remain as lean and mean as before their eating binge. In Cubas case, any amount of economic profit is quickly eaten by the choking socialist system and corrupt officials.
Whether the US companies are allowed to do business directly with Castro or not, the situation in the ground will not change much until there is openness in the economic field. Every time Castro allows a little free-market experiment, Cubans are regaled with abundance of foodstuff and basic supplies; then Castro changes his mind and goes back to his Stalinist background.
The only way a communist country can prospers is by keeping the communist ideology in check and allow a capitalist system to flourish next to a dictatorial political system, such as China. Otherwise, any foreign investment has little chance of helping the average serf.