Haven't been to Europe in a year but when, for all the years I went, I never worried about standing out. Believe me they know you are an American just by your manner and manners. You can't hide, so give it up.
I travel with one bag and everything I carry is quick wash or throw away. I go to the thrift store and get a suit or some decent shirts and pants and as they get dirty or no longer presentable I toss them. Lightens my load and gives me the opportunity to pick up something there and still be comfortable. You would be amazed at the quality of the second hand stores in Europe, you are sure to blend in with stuff that comes from the country you are in.
Usually we travel for three to four weeks at a time, by train, and I often return with something that I never got the opportunity to wear. It is glorious to travel. This summer we go to Scandinavia for ten days and it will be so much fun.
Use local currency and eat where the locals eat, get to know some people.