By the measure of the sides that are usually expected to occupy the european places have underperformed (Spurs, Newcastle, Cheatsea and even the RS)
That's arguably a measure that the traditionally weaker sides have got stronger and the overall difficulty to win points has gone up. Sides traditionally at the top no longer have the luxury of getting things wrong and still coasting into CL qualifying places. The margins are tighter.
Drop off in Europe was very noticeable, RS, Newcastle, Sportwashers, Cheatsea and Spurs were all knocked out after being schooled. Arsenal have had a cakewalk draw so far
Noticeable drop off in Europe? I'm not really seeing much evidence of that to be fair.
City aside the specific teams you mention have all arguably improved in Europe this season. Of course Chelsea and Spurs won the Europa and Conference respectively but given you describe Arsenal's run in the CL this season as a 'cakewalk' then I doubt you'd rate the teams in those particular cups.
The RS
25/26 CL Quarter Final -
24/25 CL Round of 16 -
23/24 Europa Quarter Final -
22/23 CL 1st Knockout Round
Newcastle
25/26 CL Round of 16 -
24/25 No European Competition -
23/24 CL Group Stage - 22/23 No European Competition
Man City
25/26 CL Round of 16 -
24/25 CL Knockout Phase PlayOff Round -
23/24 CL Quarter Final -
22/23 CL Winners
Chelsea
25/26 CL Round of 16 -
24/25 Conference League Winners -
23/24 No European Competition -
22/23 CL Quarter Final
Spurs
25/26 CL Round of 16 -
24/25 Europa League Winners -
23/24 No European Competition -
22/23 CL Round of 16
The country co-efficient of England / Premier League is still comfortably outperforming other European leagues.