I won't say much in these discussions because I'm not a good designer, and even thought I was the most recent WM I was more focused on managing war to give good input for what enhanced the strategy/fun of the event. Still, here are my two cents and some crazy ideas.
I think draft is the way to go. Auction was returned after war 8 as people felt it was more popular, but the hassle it is to run is a bit too much. Auction is fun, which should be considered vs the complexity it adds to decide whether it's kept (I personally don't think the strategic considerations in auction are big enough compared to draft to factor here, but maybe that's me). I think since you're adding in variable team sizes, the simplicity of draft would be the better choice.
Market had two objectives: 1. Balance war between teams 2. Introduce changes to keep meta fresh. It has achieved both objectives a little, but it hasn't achieved them to satisfaction. A big reason is that market doesn't affect things mid-war. Transmutations changes that a bit, but it's effect was minimal. Adding in coupons also doesn't address this issue. While reading this thread, I had two ideas which might have some effect:
1. Make market relevant in later rounds by adding in secondary vaults, which are added to the main vault in rounds 3 and 6. I don't know what the details would be here, maybe Teams can freely use their points and just start with a bare minimum vault and then add in counter decks as they see fit in round 3. I think this would be very interesting, adding some cool depth.
2. (inspired by dd's tiers) Make market not about cost in vaultbuilding, but about cost/benefit during rounds. The cards which are too strong and to be limited could have penalties for use or inclusion in vault, like reduced upgrades. And cards which are underrepresented can be promoted with some serious benefits, such as being freely upgradeable (perfect for archangel) or counting as 2 cards for deck discards (which would make fodder much more interesting). Do note that even with serious benefits, weak cards won't really see much play as they are still likely to lose and be a net negative for the team. So this system will have to judiciously add penalties to strong cards if the meta is to be shifted. The burden of market balance is still there with this approach, but I think the effects will be much more noticeable.
Also, if strong cards are penalized by reducing upgrades, there should be more freely available upgrades. This can be done by increasing the baseline soldier upgrades, or by increasing the availability of upgrades.