It is the management that I so much envy for their effort on keeping the club to standard for a very long time. The management have always make sure that there is a professional coach to coach the players and do always recruit new top class players to strengthen the team ahead of next season.
Ancelotti is one of the coaches that has really committed himself to Real Madrid with his outstanding skills and experience in the coaching job which has made him to know how to convert players playing as midfield to attackers and vice versa. The club is in a strong form and no club has always kept to their quality for a very long time compared to Real Madrid.
You are right that Real Madrid management looks for an experienced coach before adding star players to the squad. It is possible to produce star players, or Madrid have enough money to buy star players. But if the coach is not experienced then the players will not perform consistently well no matter how talented and experienced they are. And this the Madrid management knows very well. This is why Madrid always put experienced coaches in charge of their squads. And this team performs consistently well.
I don't know how Madrid will be if Ancelotti leaves Madrid. However, Ancelotti has already managed to build a strong squad. Madrid's squad is pretty stable right now. And that's why it won't be too difficult for the new coach to work with the Madrid squad.
A team can have all the best players but will not be able to win any trophy at the end of the season without a good coach. PSG has the money to buy all the super star players in the world but they lack that insight that a professional coach is needed to manage these players in order to bring out the best in them so that victory will be certain. This is why PSG is finding it difficult to win UCL.
If Ancelotti leaves Real Madrid, nothing will change about them still being the favorite to win UCL because that is what the management always targets to win UCL. They will get a coach that is a professional, who will continue from where Ancelotti stopped and if he fails after two seasons, he will be fired. Ancelotti is not the first coach to win UCL for them, Zidane and Mourinho and many more coaches have done it before, so more coaches will still do it over and over again.