I think that realistically if this is going to happen, it should be a 5v5 up to 7v7 since from prior experience it's very hard to have 10 people commit and all show up to play on Fight Night.
Almost every major FGC team vs. team battle I've seen has been straight up last man standing (usually 1 setup with every match streamed) and I don't see why you'd want to change that; unless you were afraid that a few top players from one team really are that much better than the opposing team.
TFC would be the next ideal location for this to happen, but if it happens in the East, will Cat and Chef discredit it because it's not a West Coast venue?
If it's going to happen in the West, then we probably won't see it happen until early 2014.
In either case.. This needs to happen