The only thing I could really see them doing is adding a neutral option for players.
They could probably take a few races like draenei, blood elves, pandaren, and maybe another 1 or 2 to make neutral. Neutral storyline would involve those races. Players of those races would be given an option to stay on their current faction or not.
PvP would still be Horde vs. Alliance, neutral people would be mercenaries and fight for whichever side. No reason to redo old quests either, just add a quest at the beginning of old zones to choose a side for that zone. Neutral people could group with horde or alliance, but not both at the same time.
I don't think a full faction would work, especially not one that's at war with the other factions.