How much did the Reformation alter the balance of power? France was the most powerful state for most of the time from the late middle ages up to 1815, i.e. both before and after the Reform. The Hapsburgs, its true, were weakened with the Reformation, but probably would have fragmented anyway given their geographical situation. Some protestant countries later rose in power (England, Prussia), but was that due to the Reformation per se? Russia managed to rise in power without benefit of either reformation or counter-ref. Had there been no Reformation at all would the European balance of power have been substantially different?
(Of "Reformations" in the plural: Sure, there were several of them, but it was also one class of things. There were also several Enlightenments, Industrial Revolutions, Agriculural Revolutions, Black Deaths, World War 2s, etc but also one class of each too.)
Less technical, eh?
Less technical still equals technical, just less so.... 
Paul: The Habsburg Monarchy could more than give Valois France a run for its money. The Reformations (I'll explain the plural later) imploded Valois France--a rather "minor" shift in the balance of power--and, I argue, played a major role in doing in the Spanish Habsburg bid for hegemony. So, yeah.
Obviously the period your talking about predates the construction of race as a category (employed socially, politically and academically), though one might say that proto-conceptions of race have existed over the years going back to the Greeks. If there are proto-conceptions, how does your argument on state-making track with Anthony Marx's work on state making's important need for the construction of race as a form of unification and centralizing control?
Dan,
Thanks for the lucid summary of your argument. Three brief (well, actually, not so brief) comments after a quick reading: (1) Religious contention, you say, could strengthen or hinder organized cross-regional and cross-class resistance to central authority, depending on the particular circumstances. So apparently you avoid a highly 'parsimonious' theory in favor of something more nuanced, which I (for one) think is appropriate. (2) Most early modern European states were composite polities, but some composite polities were arguably more like embryonic sovereign-territorial states (e.g. France and England) while other composite polities were less like that and more "imperial" (e.g. Habsburgs in, say, 1519-1559, or whatever end date you prefer). (3) What you call the dynastic-agglomerative path of state formation involved, of course, marriage, purchase, conquest, and complicated forms of familial distribution of territory (among other mechanisms), but also can be seen as being tied up with rulers' increasing use of the tools of, e.g., cartography and fortification in the slow process of defining territorial boundaries of the polity. This process (at least as far as France is concerned) superimposed, so to speak, proto-modern notions of territoriality on more 'feudal'(for lack of a better word) notions, which did not disappear. This coexistence of quite different notions of territoriality and authority can be found, I think, before 1517, and certainly after 1648.
Dan, timelines may be at the root of my disagreement. Suppose there had been no protestantism, might some kind of Hapsburg hegemony have been established in the short run? Yes, quite likely. Would it have prevailed over the long haul? Probably not. No others did in European history.
I don't disagree with Paul's general point, but it is also the case that, to paraphrase Rousseau, nothing lasts forever. The fact is that the spread of religious movements had a major impact on the European balance of power for at least a century, which is a "big deal" in terms of standard arguments in IR about the influence of non-state and trans-national powers.
A few remarks on LC's comments:
(1) I do err on the side of contingency, complexity and attention to what Weber termed "singular causal analysis." Indeed, I make some very specific claims about the importance of constructing theories that provide generalizable claims without smoothing out the bumpiness of history.
(2) You're right about variation across composite polities, and such variation plays a role in my comparative cases. But I think it is important to recognize that Valois France, the Tudor domains, and the Spanish Habsburg monarchy had, in general, more in common with one another than they had with modern states. France appears as an embryonic sovereign-territorial state in retrospect, because we know the outcome. England is rather exceptional in some ways, however.
(3) You're dead on about cartography, though. But, see (2). Indeed, have we had a conversation about this issue at one point or another?
Protestantism produced turmoil, war, and undermined the previous balance of power. But the protestant ethic did not give us the spirit of modern international relations. It wasn't progressive or transformative. (Is this meaning of Dan's somewhat cryptic, technical comments about international change?) If this is Dan's message: right on.
The lesson, it seems to me, is to try as far as possible to keep crusading religious and ideological social movements well locked up, so with luck they can do little harm. Dan: are you inclined to draw any lessons of history?
Paul: I do indeed draw a number of provisional lessons, but that's a much longer story--and the concluding chapter, at the very least!
I'm glad you endorse the message, because that's the basic punchline. The crises themselves should be seen as an instance of "international change," not the putative emergence of a sovereign state system out of the Reformations.
Representative institutions survived from medieaval times in 'isolated' states such as England, Scotland, Sweden, United Provinces (they could flood their southern areas) and the Polish-Lithuanian Commonwealth (which was vast as well as being peripheral). They atrophied elsewhere because of security imperatives. Witness the collapse of Poland much later.
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