I don't think it's a good idea to dump ALL troops in the capital - if they country is big, and there's a rebellion and/or war going on, there will be problems. What about this?
- All units with less than 5000 men are combined and dumped into the mobilization pool.
- All units with 5000 or more troops are converted into deployed Vicky divisions.
(Infantry and Cavalry are tracked separately, of course).
Navies are not a problem, since we can make 1 EUII ship = 1 Vicky ship.
(About upkeep: You can always reduce army maintenance).
POPs: It would be immensely simplified, but what about making all the pops in the Vicky provinces the same culture as in the EUII province? It would remove a lot of the interesting parts of the Vicky nationalism, though.
Number and type of Pops should depend on the amount of "ressources" an EUII province produces, and whether it's a colony or not.