A friend and I had a similar plan that we concocted back when all the expansion talks were going on. Except, instead of a four team SEC championship tournament, we rotated the four-team divisions each year to create two eight-team divisions, and the winner from each would play for the championship.
For example, the Mid South or Deep South division would be the MS and AL schools. For the first two years, we would create a “super division” with the Western Division of LSU, Arkansas, A&M, and Missouri. Then the next two years, we’d be with the Northern Division of NC State, Vandy, KY, and VT (in our example we added VT and NCST). Then the next two years, our division would be paired with the Eastern division of Florida, UGA, UT, and USCe. Then your schedule would be rounded out with your two permanent opponents from the other divisions. So in year one, our schedule would be Bama, Auburn, Mississippi (our three divisional rivals), LSU, Arkansas, A&M, Missouri (the four teams from the division we’re temporarily paired with), Kentucky, and USCe (our two permanent opponents from the North and East).
There are some problems, though. One, it would increase us to nine games, which most of us don’t want. Two, the Northern Division is BY FAR the easiest. The problem is though, the only way to even that out is to switch UGA and NC State, but then you’d have to either cancel the yearly meeting between UGA and UT or UGA and Florida. Other, lesser rivalries will no longer be played on a yearly basis, such as UT-KY, MSU-LSU, Bama-LSU, etc. I personally find that much more preferable to only playing teams in your own conference twice every sixteen years, or whatever it would be. Some might also consider the complexity of it a negative, but I think we’d all get used to it pretty fast.
One other idea I’ve had for a sixteen team conference is to have two eight-team divisions, play everyone in your division plus one permanent opponent from the other division. Then when the season is over, match up the division winners from each for the Championship, and match up everyone else against whoever their equivalent is in the other division. Have two games each at four different neutral sites over the course of the first Saturday in December. I think this would be awesome. It would be like having a second bowl game.