Other countries in Europe already do this, at least including Belgium, Netherlands, France, and Germany.
Denmark, Sweden, Italy, Spain, Portugal, etc. They all followed the example that I set with .nl in 1986. Some now work with a mixture of 2nd and 3rd level domains.
Nevertheless, given the size of the population of the expanded EU, I don't see how this kind of scheme will scale well to handle potentially hundreds of millions of people.
I don't think there's any need for that. What would private persons gain by registering <myname>.eu instead of <myname>.<ccTLD>? Adding something .co.eu (which the EU policy already rules out) or .com.eu wouldn't really alleviate the perceived problem.
I don't think you necessarily need to go to a US-style city.county.state.us mechanism
That's counterproductive: moving from one city to another, which is quite common for private persons, would imply a new domain name...
but I think a three-level domain scheme would definitely be advisable.
It might be worth considering, but advisable? Not in my view. Piet