Agree with much of this but I place a little more emphasis on winning stuff, even the more minor domestic pots. Basically I think we're not in a position to turn up our noses at ANY silverware - heck, I'd even accept a conference league win (as long as we don't call ourselves 'champions of Europe' like West Ham did, lol).
To the nub of your points - the obvious answer for me to league vs cups is a bit of both, if we can have that: the odd cup win and getting into/around the top four. I know our own history over the past 30-40 years hasn't reflected this but they aren't mutually exclusive - how many domestic cups have City won in their recent period of dominance? I'd bet it's quite a few. I know you get interesting ones like Wigan a few years back but I'd say that's something of an exception to the rule - and yes, totally accept the League/CL are the big ones.
Just to answer one of your questions directly - if we finished say 10th and won an FA cup then yes, I'd consider that a successful season. It's an exceptional circumstance but we're so starved of silverware I'd be more than happy to accept it.
My gut feeling has been we were never good enough to win a cup this year and the less said about the league the better, and that's been shown over the last week. There's of course the possibility we get lucky with the EL, but we drew with Rangers and were made to look second rate by Galatasaray, I can't see it happening unfortunately.
