Item loot is a gamble, there's people that want it and those who don't.
Almost across the board, it's a deal breaker for one side (no item loot) but not the other. I think it's healthier for the server maybe not to have it but for reasons I listed above... you're adding benefits to attacking another raid or pvping hence more incentive to go out and gank people.
Now it's true that people are less likely to level in their gear and more likely to go out and gank in gear (esp cheap resist stuff). I think it adds a fun element but I definitely expect to hear stories of people going nuclear over it and rage quitting.
Lastly, if item loot isn't implemented... I dunno about the name p99Red... know what I'm sayin'.
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