I have the same code.
The only difference is that i don't have this line:
Option "XkbRules" "xorg"
So i have add the line:
Option "XkbRules" "xkb"
after i read
Changing XkbRules to "xkb" resolved issue
but the problem persist.
Also I had remove all of this line otherwise even xterm don't recognized the italian keyboard layout.