Gonna get me some baby oil then :D

I'd rather not limit them to only primitive hollows as it's a normal event in Bleach universe for Arrancar to exist, but since there is no Aizen and Hogyoku (I wrote that wrong, right?) - there would also be no massive spawns of powered-up hollows. 

I mean, I'd let other species exist, just not available to be PC's. And a main focus would of course be on the conflict between Shinigami and the Jacks, but without hollows and other species, there wouldn't be a lot of enemies to fight when the two formerly mentioned forces are not clashing. 

Now that is a good question. The main plot would take place in Soul Society as there is more than enough area to cover there, but should some characters go on short missions in the human world, I don't see a problem with that. As long as it's the main focus is not entirely shifted out into Human World or even less into Hueco Mundo (which wouldn't even have any role here, in my opinion)