Although we've gone off-topic, I also find the Evony ads disturbing.
I actually played Evony about 8 months ago, and those ads have absolutely nothing to do with that game.
Back on topic, I do like your idea about grouping smaller countries into "regions" for the purpose of keeping the game competitive and fun for all involved. The only issue I'd have with doing so is if one country suddenly blossoms in population and needs their own league, suddenly realigning all the users from that country into their own league would be an issue (or worse, asking them all to abandon their teams and start new ones in a new, dedicated league).
A quick click on the Community tab shows that there are over 200 countries playing BB, but only 94 countries with leagues to play in. One is almost forced to wonder if all those countries suddenly received their own leagues, how many of them would grow? And how many are not growing because they don't have their own leagues?