I'd love to see it happen. Kaguya seems like... the epitome of evil. Her small cameos make her look so vicious, and I love it. Madara may have lost sight of his initial goal with being so powerful, but his end goal is ridding the world of what plagued the original system him and Hashirama concocted. Kaguya taking over and turning the dreams into a nightmare rather than whatever the ninja want would be an amazing twist. And Madara is below Kaguya power-wise anyways. So Naruto and Sasuke would get even more powerful... Probably surpassing Rikudou/Madara on their own.
I don't think Kaguya will manifest physically if that's what you're implying. There is a possibility of her taking over Madara but we'll see, I still doubt it.
It would be odd for the main villain who was prevalent throughout the series to all of a sudden be replaced by a character recently introduced. It would make more sense for them to merge.
Kaguya's power is already being displayed through Madara, so my the most I would expect from Kaguya is to possible interact with Naruto and Sasuke the same way Hagoromo did.
The whole "manipulator of the manipulator" has already been played out too often.
Nagato was manipulated by Obito and Obito was manipulated by Madara. Having Kaguya in the mix would be a little redundant for my taste.
