If he gets trapped in the dagger I fully expect the dagger to be locked away in some vault by the Kirin Tor or some other "neutral" faction for safe keeping, or even kept within the Seat of the Panteon under the guard of titans. If a lore character just got to wield it it would be insanely stupid writing, worse than most of BfA.
What I expect his plan might be is that he wants to get trapped in the dagger and then get a humanoid form like Xal so he himself could roam more freely (maybe that was why he released Xal, to help him with that and she agreed because they were both underdogs and weaker than the rest of the old gods).
If he gets trapped in the blade and becomes humanoid while still having control of his massive old god body that could be quite devastating since he wouldn't need to rely on his minions as much.
Maybe he gets trapped in the blade and in 9.0 there is a new NPC "good" to the factions but if you have the Eye of Nzoth thingy you see a void aura around him. His plan might be to turn the leaders to the void (Anduin used shadow magic before) and with Alleria as an example he might be able to convince him that dabbling in the void is completely harmless.
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How much does Azshara know about the titan facilities? Seeing how neither zone has any naga presence. She might've heard of them but doesn't know their full power. For her the only way she knows of might be the blade (and that might again just be beacuse that is what Nzoth or Xal told her a long time ago knowing she wasn't one to be trusted).