Hey, I'd definitely be interested in this. I think one of the major issues that comes with creating something around League is the same thing that comes with other really really big worlds. Focus. Too many options and settings always start feeling kinda random and pointless to me. One way to maybe circumvent that would be to focus on the Demacian-Noxian conflict.
Basically, you could have all those places that you mentioned in there, but because Demacia and Noxus have their hands all over Runeterra, the other places (factions, rather) are either Noxus-aligned or Demacia-aligned. To further accentuate this, you could seperate factions into Major Factions (Dem, Nox) around which the plot mainly revolves, and Minor Factions (Piltover, Zaun, Freljord, Ionia) that each have their own stakes in the war and support either Demacia or Noxus. To top it off you could maybe have neutral factions in Ixtal, Bilgewater and Targon? Idk, it's already starting to get really expansive at this point, but I do think it's an idea worth thinking about. Especially because you could really get into it. Maybe Demacian allies are only reluctantly allying themselves because of Noxus' aggressive expansionism and care about self-preservation leading them to oppose Noxus more than they are actually loyal to Demacia, whereas Noxus' allies are more loyal but don't necessarily agree with Noxus' aggressive expansionism. Idk, something like that.
As for Shurima, I think you should throw it in with the Shadow Isles as kind of a "lost kingdom" type deal that characters can explore IC'ly maybe with some custom Ascended NPC's to throw in for interaction and quest goals?

As for creation I think you could be a bit lenient with races, even though I don't typically like that. But it's League and it has a LOT of established lore. So Humans, Vastaya and Yordles and I wouldn't be afraid to add Spirits as a catch-all for anything demonic/divine (think Kindred and Nocturne in the same category). To round this out, maybe also add "hybrid" races, ie Elementborn (half-elementals from any race like Liss, Voli or Ornn), Voidwoken (void-altered from any race) and Half-Dragons (like shyv, maybe limit them in number somehow).
As for the more 'potent' races, like Ascended, Aspects and Darkin, I feel they should remain npc's and act as catalysts for plot elements.
And for powers, well I think in true League fashion, every character gets five abilities, one passive, three active and one ultimate ability that has to fit to their personal lore somehow. That kinda writes itself, I feel.

To come back to plot again, I think a lot of plot can just be achieved through filling in some details in the setting with original content. So make the Piltover/Zaun conflict be an extension of the Demacia/Noxus conflict with Piltover being Demacian-aligned and Zaun being Noxus-aligned. Perhaps zaun spies working for noxus in piltover is a sub-plot. Things like that. An other issue that arises would probably be canons. You'd have to limit it the bare essentials to not have the issue of too many canons and not enough characters interested in filling them out. Alternatively, just make all really important positions npc's.

That's my ideas so far. I'm down to talk some more via Disc though if you want.

Ripper

As someone who ran a League of Legends site for a little bit: I do want to stress there is a lot of lore to shift through which makes for an even greater amount of information for readers to read. As an example: you've got around 15 different nations and I think like 30 different sub-factions (things like "the Black Rose" or "Frostguard") included in Runeterra and that doesn't include things like unique flora, fauna, or species.

As Mavroh posted above me: trying to find particular plots to focus on will make the site a lot easier to run: but I think the hardest part will be finding a way to compile all of the information into something that's easy to digest and understand for those who aren't familiar with the lore. You not only have an empire expanding and a city capturing those who can do magic - but you also have two warring communities in the freljord, an empire in shurima that's slowly making it's rise again thanks to the return of the emperor, and an entity known as The Void that's slowly consuming all. There's a lot of options to work with so narrowing it down to the Most Important plot in the moment is key, I think.

I also think allowing for more options of races is always fun and unique. You have (again as Mavroh mentioned) creatures like spirits but you also have canon entities seen in the game like trolls, undead, golems, and voidborn. I wouldn't be too quick to limit species as allowing someone to create something like a voidborn can lead to great plotting / event potential in the future. I also think maybe allowing people to create ascended / darkin / and aspects would be fun to allow players to be but maybe as a "premium" race or only allotting one per person. You could even make certain specific canons and allow those to be filled ("The Aspect of Time", "The Aspect of Peace" etc)

Personally: I'm also someone that would rather enjoy having canon characters as an option. But I would, at the very least if you decide not to add them in as playable, still keep them in the lore. Otherwise it makes certain events difficult to portray or some groups not relevant at all. Irelia, for example, was a huge aspect in the fight between Ionia and Noxus. Ashe and Sejuani leading their two tribes in the Frejlord etc.

Overall though I'm super excited to see the outcome of this c:

Would it be set in the old map or the new map of Runeterra? Regardless, going off of Mav's post, I'd also like to see the main focus be on Valoran (the northern half [and also Ionia I suppose]). At least for the start and the rest could open up at a later date. (Ixtal on the old map would be in Kumungu and the Plague Jungles.)

mavroh - Ok so I do agree its a lot.. I mean a lot to sift through. I was thinking of giving general overviews of places, sticking myself to a word limit for the bigger places and putting the needed info into each one. Though I do agree the Demacia/Noxus conflict would probably be the biggest and kinda first overarching plot line. I do agree with a lot of what youre saying as far as the factions go though, it's gonna be a LOT if everythings opened up. Maybe the site could start with Demacia and Noxus and slowly expand as members kinda join in? As far as the races go I would be totally open to adding spirits and even half dragons. Maybe eventually the Void because we could have an event for some of the void stuff. I'm one of the nerds who got the lore book too so I have quick references

avan - I think the hardest thing with the site is gonna be both limiting races so things arent spread so thin and allowing enough that it isn't limiting. I do know Demons I wanna be kinda careful with and Darkin/Aspects are gonna be a tender thing to mix but I do kinda want em in the site. Most of the Canons will probably be there but not playable, can't have Noxus without the bladey bros or without crow boi ya know. It just doesnt feel noxus

Magma - I'm thinking new map because it kinda makes things a little more clear, but most of the focus would totally be Valoran since thats kinda the big plot area for a lot of things. I do really like the ideas again of kinda expanding the map as things go on.