> The result is it can't adequately respond to challenges (ie: Crimea, the PIIGS debt crisis), but everyone still hates it for cramping their style
They did respond with sanctions and they hurt Russia badly. The effects take a little while to appear. Ukraine is not a EU member state and that is the only reason for Russia invasion into Ukraine.
> In the long term it's probably much better for Europe if Europeans decide to go the route we Americans did, and create a truly Federal state with it's own Army.
Countries in Europe and EU member are not interested in such move. Never have been and I don't expect that to change. There are also far more states in Europe then you think. Germany is made out of 16 states (U.S model type of federation), UK is made out of 4 or 5 (+ dependences and so on) states. There are in total of 50 states in Europe as it is today. Not all of them are EU members. This is according to Wikipedia.
Europe got NATO for defence.
Germany is made up of 16 Länder (states).
Switzerland is made up of 26 cantons (states).
There are 85 states in Russia alone and many of them are in Europe (geographically speaking). I am not counting Crimea, since Russia illegally annexed it into Russia. For me it is still part of Ukraine, it is just being military occupied by Russia in illegal manners against international law.
The picture of Europe is far more complex then many anti-EU people claim. EU is just one angle of it.