Eurofed
Banned
About this, I think I have a neat solution. After Iberia buys the "Byzantine" title, well, it was an established "constitutional" fact of Europe that there could be two "Roman Empires", the WRE/Carolingian and the ERE/Byzantine. So we may have the HRE and Iberia to recognize each other as the new "Roman" empires in a treaty (dynastic ties here would help). Protestant Germany-Italy takes the title of "Northern Roman Empire", or "Christian Roman Empire", Catholic Iberia-Africa takes the title of "Southern Roman Empire", or "Apostolic Roman Empire". Each dominant European great power on the two sides of the Christian feud takes the Imperial title, a neat balance. At this point, Iberia would not really need strong Papal support to get recognized by Europe at large as a worthy successor Roman Empire. They could also do this as part of the deal where the HRE is recognized control of southern Italy, and Iberia a sphere of influence in North Africa.
As it concerns the proper seat of the Papacy, I think it is an issue of the Curia's behavior. If the loss of Italy and Central Europe has weakened the Popes enough that more or less they remain forever cowed and submisssive to the Imperial authority, like Byzantine/Russian Orthodox Patriarchs, then they can stay in Santiago. If however, they stir up to theocratic ambitions again, then they need to relocate someplace else.
As for the new home of the expelled North African Muslims, I agree that for Iberia, dumping them in a valuable and relatively "close" land like Brazil makes little sense. I would suggest something that would look more remote and less valuable to 16th Century Europe, such as Southern Africa, Madgascar, or Australia.
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