Companies also probably have servers in other places, meaning perhaps they’d connect through elsewhere
Depends on company, but that worst case scenario is that all US companies would shut down all their services in Europe overnight. Every big player has datacenters around the world and if it's just the traffic between continents which is shut down then the effect is way less radical, absolute majority of Europe already connects to datacenters near them even if they use Microsoft/Google/Amazon/etc services.
For example with my employer dropping every US based company would be a hell of a work, specially if it's needed in a hurry. We, as well as a ton of others, rely on Microsoft services for all kinds of communication and should that go away we'd need to make quite a few phone calls around couple of continents just to set up a common ground on where and how to start building new infrastructure and how to keep communication lines open.
Though if it were for a few hours, maybe let people see the consequences of their dependence, and what life would be like without these services
Few hours is a short time. There's some problems around the globe all the time which affect various services on various levels for few hours all the time. Few days of complete blackout and C-suits start to really sweat (plus it costs significant amounts of money via lost productivity).
if anyone knows how to block connections based on location, feel free to enlighten me
You'll need a firewall/router which can do geoblocking. Based on quick search at least pfsense seems to have some options available. If I were to try that I'd set up a pfsense on a virtual machine, set up geoblock on that and use that as a gateway for my testing devices while leaving the rest of the network as it is so that I could limit/choose what devices may behave strangely and still have normal functionality for the rest.
I assume there's a ton of other options too besides pfsense, but the key words are 'geoblock', 'firewall' and 'router' or something around that. Also I assume that most of the stuff you find explains how to block incoming traffic based on geoIP, but it should be relatively simple to adapt those for outgoing traffic as well.