Hmmm, well I've put a couple hours into Pokemon recently, so I know more about it than I used to. To be honest I think this basic idea could make a good MMORPG, but Pokemon itself would not work well with the idea. The world and basic mechanics are too geared around the idea of a single player experience being at the core. It's also I feel a bit too cutesy to be a major success, despite the people it would draw in just with the "Pokemon" name.
Truthfully though, a game in a similar vein to the Shin Megami Tensei games that take themselves more seriously, and balance the cute with the grotesque (Mara deserves some kind of award) seems like it could be successful. Especially seeing as using a new world for it would prevent problems with trying to balance existing creatures for an MMO enviroment.
So far I've seen a number of games with a certain degree of potential that even had players commanding groups of characters rather than a single one. Both the defunct "Gods and Heroes" (which I betaed, I think I have the name right), and "Sword Of The New World" involved a concept where you were commanding a band of characters either outright, or a single persistant hero who collected followers. Obtaining additional characters and/or monsters for your "family" or "camp" was a key component to the game and a reward right alongside the equipment/weapons/armor/etc...
The idea definatly has potential, but the experiments with it have failed so far. I do see the potential if a big developer with a decent budget decided to give it a spin however.
Truthfully though I suspect such a game would require a lot of depth as well, more so than Pokemon has (despite what some people think) for example, the focus on Pokemon is entirely on the Pokemon themselves, you don't see trainers getting involved in battles or anything themselves. Heck, I don't think I've ever even seen any adult characters running around with weapons, never mind the presumed legions of people who are not involved with the Pokemon. This can work within the simple confines of a gameboy game, but truthfully in an MMORPG all of this would need to be worked on, and that would involve doubtlessly working on a far less interesting concept where the characters would be just as much a factor as whatever minions they happened to collect (Much like Gods and Heroes tried to do).
Such are my thoughts.