You make some very good points. I think we can definetly incorporate some of these ideas once we release the first beta version of the mod. However, since these cities are in place already our focus is to get a playable version for people to test.
Once that is done I think we should definetly find a working solution to the german situation. Many years ago there was talk of either having Bavaria as a faction or the Holy Roman Empire. The only way to do this would be to remove one of the shadow factions so that fell through (we need at least Serbian shadow to prevent it from becoming a huge blob). But who knows what might happen in future versions.
Also, keep in mind that the rebel settlements will not be like in vanilla. They will be more active and also will be fully stacked up so they will be very hard to occupy.
For the swiss I think we need to find a compromise so to remove Schwyz and replace it with another city which was a lot larger and more important.
We can also use the mechanic of PSFs. So we can have forts which have Austrian troops in them around the Swiss areas and this would definetly trigger Swiss-Austrian wars. And of course there is scripting to try to encourage Swiss-Austrian conflicts. I agree it might not be a bad idea at all to have an actual Austrian settlement in the area of the Swiss to make it even more of a pain in their backside.
How big were Ensisheim, Laufenburg or Burgau?
Having a look at the Habsburg possesisons I think we definetly need to have either a settlement or lots of PSFs with Habsburgs in the Swiss area