Most important thing is getting a full 7* arena team (RG can be viable at 4 or 5). The more crystals you get, the more refreshes you can do, the faster you can farm characters and gear. One of the biggest mistakes players make is getting a character to 5 stars then changing to someone else. Like chuck covered, its way better to have 5 7*s then 20 5*s.
Don't be afraid of increasing your power. I used to be afraid of this too but as galactic war is scaled up, so are your characters. They'll hit harder, have more health, etc. I really never hit a wall in GW.
Looking at your lineup, a pretty solid arena team would be Dooku(L), Sid, Lumi, Poggle, GS. I wouldn't run Dooku til he is at least 5* though so another good option is Sid(L), Lumi, poggle, GS, Daka.
Remember, focus on getting your main squad up to 7* with max abilities and gear.
In GW I'd run Lumi, Sid , Daka, GS, and JC. 3 healers and GS's damage output should carry you through it. Always try and enter the next battle with at least 1 heal up. Heal timing is huge in GW. Don't end a battle with things looking poorly. You can always retreat and try a different approach.
Hope this helps.
