First I want to say that it's a great TL and I liked it, with lots of twists and turns.
Regarding countries, we have an interesting balance. Abandoning Austria while it makes sense because it is on the border of the Ottomans, is a bad idea for a long time. Soon the Ottomans will begin to enter their long process of decline. That could be great for Hungary, a country that rarely does well in TLs. Not only that, but it places them (the Habsburgs in a place that is more easily accessible to the French and English.). Other than that, a greater focus on organizing the HRE is smart. Dont know how viable it is to transform the empire into a nation. But more competence will do wonders for HRE
England is doing the best they can with the cucumbers they receive. And they have a very intelligent queen. Sooner or later a problem with Calais will occur and France will take the fort. The only way to stop this is to have more territory on the continent. However, it is expensive and requires more investment in the English army.
The Ottomans have a very good position in the world, the Habsburgs have their headquarters far from their territory. The biggest problem will be in the future with the Hungarians and Russians. Other than that, any idea of more control of the Mediterranean depends on Crete and Cyprus. Without first achieving this, any advancement is a dream.
Spain, while it seems to be in a worse position, is much better without having the cancer that the Netherlands was. Hopefully, they are smart and invest their money correctly. If they want, they can sit still and focus internally. If the opportunity arises, unify with Portugal, or try to prevent the Protestant advance. But other than that they are in a very stable position.
Bohemia interestingly will probably be one of the biggest "German" powers with its independence and lack of competitors. Poland and the Scandinavians are doing well too.
Portugal maintains its power but without reforms, it will have the same problems as OTL, perhaps with the big difference being the non-ascension of the Dutch. So they can very well secure their power in Asia (the great Portuguese dream). Even with other powers trying to reach Asia, they can maintain their monopoly for longer. I don't know what this means for their territories in America, and if they are going to be ignored even more. The New World gave Portugal a lot of money but also demanded a lot of money. Brazil then generated 40% of all the wealth of the Portuguese empire in the 16th century, but it required a lot of investment and work. Logistical complexity, local resistance, environmental adversities, and the lack of high-value products made the colonization of Brazil much more costly and challenging for Portugal, compared to the establishment of profitable trade with Asia in the same period.
Even though it was a bigger part of the pie so to speak (Asia accounted for around 30% of Portuguese profits ) they had greater profitability from Asian products (Products such as spices, silks, tea, and porcelain had much higher profit margins than Brazilian products).
Now let's go to the country with the biggest difference. France, the nation that won Italy. No matter how many obstacles there are at the moment, they are THE power of the region. As a whole, we can say that at the moment it is a French century. All of this new land in Italy will strengthen the Mediterranean trade and the great focus on the Levantine (Mediterranean) Fleet, which will make the Atlantic Fleet very irritated. In OTL the Levant fleet – at least before the Wars of Religion – was granted a regular bursary, and the Atlantic forces received the scraps. In both 1561 and 1562, its treasury recorded less than 40,000 livres being spent, compared to over 225,000 in the Levant. Financially, the kingdom prioritized the Levant fleet and would continue to do so into the early seventeenth century. In Europe, France will probably behave similarly to OTL so there is not much to speculate.
Now with the king allowing the Atlantic fleet to try to route to Asia and interact in Brazil, we are going to have a lot of tension. The Atlantic Navy was very decentralized and this venture would provide the funds needed to reform and truly centralize that navy. In OTL The intense French maritime activity is accompanied by numerous acts of piracy and aggression against the Portuguese to try to expel them from the region, both in Brazilian waters, as well as at mandatory crossing points on return routes. The situation got so bad that the French Atlantic merchant and military navy was attacking any Portuguese ship they encountered on the way to Brazil. This in my opinion demonstrates a certain desperation for resources on the part of the Merchant lords and admirals of the Atlantic fleet. The Fleet in all but name was in an open war with the Portuguese navy (even if France was not). That is why, in a spirit of appeasement, the French and Portuguese sovereigns, after signing a treaty of friendship in Lyon (July 14, 1536), convened in Bayonne, in 1537, a Court of Awards, intended to resolve conflicts between French and Portuguese shipowners. This Court, however, did not bring any agreement, except that Francisco I undertook to prohibit his subjects from trading in Brazil. The Atlantic navy pretended to obey but continued to act aggressively towards the Portuguese. This is something repetitive in this era, the Atlantic navy did not always obey the king. A grand admiral of the Atlantic navy even said that after the king he was the most powerful man in France. This is due to the search for financial sustainability and the fact that the ships did not belong to the king but rather to nobles who "lent" these ships to the king. So theoretically, if this group becomes strong enough, the king will have to deal with a parallel state using the colonial empire to strengthen itself against the Mediterranean navy and royal decisions against their interests. The Atlantic Admiral was different from the Mediterranean one due to its vast religious diversity (Protestants and Catholics) and ability to function without problems (at least until religious wars). But it was not as if Henri II ignored the Atlantic fleet he tried to increase it (something that occurred until the religious wars), but the Mediterranean was the priority.