I agree that this year there isn't this one team that everybody believes will win the Champions League. Manchester City is always a favorite, but compared to last season they are not playing as perfectly. Real Madrid has very strong games, but sometimes also underperform. It's difficult to compare teams based on their performances in the domestic leagues, but Inter Milan is doing very well and could once again make it into the final and perhaps win it this year. Bayern Munich is erratic and some of the other big favorites, too.
An impressive performance in the domestic league may not necessarily provide good results in the Champions League because the two competitions are very different. It will be very difficult to predict which team will emerge as champions in the Champions League because the competition has only just started in the group phase and there are other big matches that they have to go through after the group stage ends. Inter Milan are having a good season in Serie A, but in the Champions League they may not necessarily be able to reach the final because many other teams are quite strong this season with equal quality players in all positions.
If I could choose then I would like to see Real Madrid, Bayern Munich and Manchester City playing in the final because the three teams have evenly distributed players in the squad. So the opportunities for these three teams will be much greater than for other clubs and I also see that their performance in the group phase is still quite strong even though the opponents they face are a little easier.
Of course there is no team "necessarily" reaching the final because of their performances in the domestic league, I would never say that. I would still argue that it can be an indicator, but there are extreme exceptions like we have seen with Sevilla in the Europa League. But I am quite sure that if we look at all title winners from the past, the majority that won international titles also played a strong season in their home leagues. I said the majority, before anyone says that I said something like "every time".
This unpredictability factor is always inherent in these international competitions as players can show different performances out of a sudden.
I also find it difficult to say that one of the top teams played a bad Champions League season when they play against each other in the round of 16 or quarterfinals. I mean if it is Real Madrid vs. Manchester City in the quarterfinals, one of those two teams inevitably has to leave the competition, but does it mean that the loser also played a bad Champions League season? One team has to go, so a lot depends on the drawings as well.
There is a difference when you see that Manchester City last season had to beat Bayern Munich and Real Madrid whereas Inter Milan had to beat Benfica and AC Milan.