Personally, I love that Legendaries are unavailable. They'd likely screw up the metagame, unless they were banned from competitive play, which they probably would.
Raids are a good idea, probably won't be implemented for quite a long, long time. But if it does, it'd be something pretty special and iconic of PokeMMO.
Loot alternatives would have to be maybe rare TM's. Moves from different generations possibly. A Masterball. Holdable items, like to evolve Scyther or Onix could be obtained only through these raids, giving players more incentive to go on the raids. Just ideas.
Also, you can totally beat Lt. Surge.