Hello FlyerTalk!

First timer here. I need some advice regarding the situation that 2 of my friends and I are in. Quick breakdown of circumstances as follows:

3 passengers involved. Our flight tickets were cancelled while we were making our way to the gate.
1) Arrived at Brussels Airport over 3.5 hours prior to departure. Upon arrival to the check-in desk we were told that check-ins would not start until 2 hours prior to departure.
2) Returned 2.25 hours prior to departure, with a line backed up and minimal staff. The wait was 45+ minutes but we are issued our boarding passes.
3) Security takes 30 minutes and (edit)passport control line takes nearly an hour. By the time we clear that line it is already well past departure time.

Our return trip was delayed by one full day, mostly spent at the Brussels Airport. We were forced to book new tickets at cost as well as hotel and food for the night. We are based in the US (California), the airline is Headquartered in Ireland, and the airport was in Belgium.

We have opened a case with them directly and have been going back and forth. Originally they were obstinate in refusing to reimbursing any amount to us but recently I have received an email in which they would be willing to reimburse the price of one ticket "as a gesture of goodwill", minus a "missed departure fee". Needless to say, we are looking to decline that offer and pursue what we believe is the amount necessary to be made whole.

I learned of EU regulation EC 261 2004 recently and wanted to know if it is possible to be compensated appropriately according to it? And how would I go about it, file small claims in another country? Would I be able to have this done online or would we have to show up in person? Or is it possible to file a claim in US small claims under European law? I'm new to this and any advice would be appreciated!

Thank you!