I can't claim to be too familiar with the actual details of the European system but most of Europe is moving towards the http://en.wikipedia.org/wiki/Bologna_process" as a way to try to produce a standard for degrees across Europe. The article I linked to should provide some more information regarding the Bologna process and how this links in with most European countries.
As a an example for a UK degree the MSc will typically require a student to obtain 120 credits at masters levels (at least it does for my 4th year - although this is part of an integrated undergraduate masters called an MPhys, just to add to the confusion!

. This may be made up of 60 credits from taught modules (e.g 24 lecture course ~ 10 credits) and a 60 credit extended research project with a supervisor culminating in a thesis (~50/60,000 words?).
I can't really say whether the 3+2+3 European model or the 4+3 UK model (4 year MPhys + 3 year Phd) provides any better training or preparation for a PhD though, sorry.
As for European institutions offering a good MSc, well there are plenty of great universities to choose from. A good idea may be to take a look at some http://www.universityrankings.ch/results/results_main_rankings" and just mark out a few that may seem interesting (perhaps due to location etc) and check up the courses they offer. Sorry I can't offer a terrible amount of advice on this as there really are so many to choose from.
Finally, something that may be of interest (and I forgot to add to my list) is the http://www.sussex.ac.uk/physics/1-2-23-3.html" which may offer the kind of balance you may be looking for.
Again, sorry I can't offer much on how Europe does things but hopefully someone will be able to give some more details. Hope you find something interesting though.
(I seem to have a bias here for Cosmology/Particle/Theoretical!)