Actually, there is a new take on the Squadron Supreme out now, called Supreme Power. It's written by J. Michael Stracynzki. The first issue had some rough sketches of what Nighthawk will look like in the series costume wise, and he doesn't look anything like the old costume designs.
Nighthawk was also a fairly popular character, as evidenced by his longterm appearance in the Defenders comic, and a mini-series a few years ago that brought him back after he seemingly died (shortly before the Squadron Supreme mini-series that brought back the original Nighthawk).
As to using Nighthawk for the Champions, I don't see a problem with it. As others have pointed out, names get used and reused over and over in comics. Granted, the bigger names are not copied (for obvious reasons, like avoiding legal hassles), but the middle tier to lesser ones are less likely to draw a fuss.