Plarium has done a pretty good job of defeating the purpose of PvP on their own. Either way, no, you don't belong in bronze 3 with a level 40 account with fully ascended 40-50 champions, at least not according to the mission progression. Setting aside the fact that it's not my job to fix the game, though I'll certainly give it a go if you can convince Plarium to pay me, I actually have proposed some things, but since any unofficial response has pretty much completely ignored anything I've said in favor of parroting the same old things about team composition and how easy it is, and any official response has been remarkably divorced from reality, I don't really see why I should bother.
But let's run through a few options quickly then, shall we. Base matchmaking on your arena points only, period. The current system is inane and open to gaming. Push strong inactive teams up, not down. There are numerous ways to do this. Alternatively, or in addition to, remove inactive teams from the matchmaing. Not after months, not after weeks, days. Acknowledge that the arena is end-game content, increase the entry to I dunno, level 60, and remove arena missions from progression or push them much further down the line.
The core issue is this. Plarium has at some point built a system that may or may not have worked at the time. Things have changed, but Plarium refuse to adapt. Apparently they've tried some bandaid solutions, or so I've been told, but either it didn't really work or they removed them. This creates a situation in which players, especially new ones, are presented with features that they are explicitly told by the game to interact with, yet they have no ability to do so realistically. Good luck getting a great hall bonus to level 4 before you can get 3 stars on the hard campaign. Although, you can do it and I nearly did (unfortunately I wasted silver medals on level 2-3 upgrades in the belief that I could get more), because the matchmaking is idiotic. Ironically, all that friendly advice you get from veterans that tell you how easy it is and what you should do is directly counter-productive to that end, at least for the lower tiers of the arena. Sure, set up a spirit host/warmaiden/khatun/starter speed-nuke team, but ignore everything else. I had more arena success doing the exact opposite of what I'm now told I should be doing, with a team that was much worse than what I have now. It probably won't carry you to gold, but S2 definitely and probably a bit higher (unfortunately, I screwed over myself by starting to play the game rather than play the system before I got more than halfway to S3).
Plarium either have no clue what they want to do with the arena, or they have no clue how to get it to do what they want. Unless what they want is to create the worst ranking system I've ever seen and as a bonus locking out progress in unrelated parts of the game. In that case, mission accomplished I guess.