Assuming we could set up factions, it would give us a great opportunity. For one, we could name the faction, which is a whole lot of fun in itself.
Examples (A bit childish, sorry, I've got Easter Candy):"No Girls Allowed", "No Boys Allowed", "Sayers of the Sooth", "The Elven Lineage", "The Alliance of Humans", "Native Allegiance" (Sload, Argonian, Khajiit, Imga).
You name it, you could probably find some NPCs for the faction even "Love Transcends Death"... Although you may only get Falanu Hlaalu in that one.
Spoiler Falanu Hlaalu - "I'm the only alchemist in Skingrad. Not much business here, but I can't go back to Morrowind. It's just like anywhere else in the Empire. By the way... do you happen to know what the fine is here in Cyrodiil for necrophilia? Just asking."
Secondly, you could recruit NPCs into it, probably based on their disposition., if it were to be implemented. The group could also have a "Reputation", as good, bad, neutral, or anything in-between.
Thirdly, perhaps you could buy a building and use it as a Guild Hall, so then you could really get things underway. You could tell people quite simply to set the cell as their home (in scripting, dialogue would obviously be more fun), and then they could go, do their daily business, and sleep in your guild hall. You could also ask members who aren't trainers/shop keepers/ important characters to come with you so you could then have a party. This would also be great for keeping track of a companion character you don't want following you 24/7 or running "home" to the other side of the map.
A fourth point, is that your group could be given tasks based on the old game's AI, like gathering items and putting them in a box, fighting monsters (or people, if you want your Faction Bounty to go up.), and other things like making potions/weapons.
Fifthly (if that's a grammatically correct term), you could build it up, recruit new members, expand/relocate from different buildings, have a place where you could store things, and maybe you'd be given randomly generate "faction quests" based on the type of faction you chose... which would require a conference of people to decide.