I'd like to see it put down to top 2 from the top leagues plus 1 from second tier leagues with play-offs for the rest. No more than 24 teams. Means that the Europa/UEFA/whatever would get more importance too, like it used to have.
They both need restructuring
"Champions" means it should be a Cup winners cup, winners of domestic league +2 domestic cups, maximum of 3 teams from each country. That way, even top clubs aren't guaranteed a spot in every season and you would get the odd wild card. Two leg knockout. It would vastly improve value/credibility of domestic cups
Europa could be a "league" where you qualify via league position, and there you could have 2nd-4th place teams (would include a lot more high profile teams including the Barca's/Madrid's/etc.), alternatively you could use co-efficient over 3 years if you want to keep status quo of teams in. (This would effectively create the European super League people have talked about), If you wanted to be really stupid, teams could be in both.