I think you could run 16 teams; EC definitely needs to be split imo. EC could be split into New England, NYC (Sp00kyland), NJ/PA, MD/VA. And AZ stands alone, motherfucker! You could also argue that the Pacific Northwest and Canada should have their own teams. I would also argue for splitting up Japan and Europe because jesus fuck I don't want some JP players carrying EU players to a win and then hearing about it from those nitwits.
So here's how I see it:
1) NYC
2) NJ/PA
3) New England
4) MD/VA (or you could move PA here too and leave NJ standalone)
5) Soufeast (NC/AL/TX/LA) -- Texas may be able to be split off? NC as part of MD/VA? I dunno
6) Midwest (IL/OH)
7) SoCal
8) NorCal
9) AZ/NV
10) Northwest (WA/OR)
11) Japon
12) Canada/EU (Canada and EU split?)
13) rand()
...fuck, three short. :|