IF we go to divisions (I'm not convinced that I want that yet), I would suggest one of the following two options:
1. Two 8-team divisions.
Details:
-Basically what you said. Two division winners, each get byes. Seeding by record after that.
-Schedule would involve playing everyone once, and playing previous year strength-of-schedule based matchups *only within your division* for the remaining 5 games. The intra-division schedule would actually end up looking a lot like our current one (just with a different size).
2. Four 4-team divisions.
Details:
-Four division winners, two wild cards
-Schedule would involve playing everyone in your division twice (6 games), and all but one team outside your division once (determined by previous year blah blah) OR playing all but one team in your division twice (5 games), based on previous year blah blah, and playing everyone else once OR going back and passing the last amendment, lengthening the schedule, and having exactly the right number of weeks
-I heard you like football, so we put a football conference in your fantasy baseball league...
As for who goes where, I can think of a couple ways of doing it:
1. Geographically
2. Based on prior-year standings (this probably only makes sense if the divisions are in flux from year to year)
3. Randomly
I think I'd be okay with any of the options I've mentioned (weird, right?), though I'm still not convinced divisions are the way to go.