It's an NPC. And you are trying to make it interesting. Don't be constrained by the rules. Within the rules, you can the feat Natural Bond or Wild Cohort to improve your animal companion. Heck you can just take Leadership and now you have a druid with an animal companion only two levels lower than you. Or you can just train an animal of the appropriate animal companion level using the Handle Animal skill.

Trading off spellcasting for a full progression animal companion is way more than enough. Without spellcasting, the ranger can't buff his animal companion which is what the animal companion focused ranger would be doing anyway.

So, in the end, I say remove spell casting, give the full progression animal companion and have a fun encounter.