I don’t think this is the actual way the Challenge Cup should be run. about it is close....
I think the most populous states..CA, Texas, Florida and NY would need to have some kind of mason/dixon line to split them in half.
CA in the past had a norcal and socal state director and the state was split at “I think??” at Bakersfield.
I would also think for the “upper levels”... To help the less populated states... you should allow Adjoining states to merge as long as their population numbers don’t exceed 20 million.
This Challenge Cup is a great idea and is on the right track...