this wouldn't be A mmorpg, it would be mmopokemon, which wouldn't have to be like everquest etc. it doesn't need loot, it has something better, pokemon, the time it would take to catch all 350 pokemon would keep me ocupied for several months at least, especially when some can only be caught in day/night etc
also, for the Unique pokemon, my theory is they could have say 15-20 servers, or perhaps regional ones, so that there would be 1 mew two etc per server. ofcourse that would mean you could only play on that server unless you wanted to start anew on another server.
another idea i had was to solve the question of the starting pokemon (squirtle bulbasaur and charmander on r/b and totodile cindaquil and chikorita on g/s/c) would be a random choice between one of the lower end pokemon (from say pidgey to krabby etc) that your "parents" give to you to start you on your way to being a pokemon master!