This is something that I've... kind of put a lot of thought into. Maybe not as a Fire Emblem game exactly, but a strategy game like Fire Emblem regardless.
To keep it short, my general idea is that in this world the Dragon Empire (aka Japan) rules the world from their island fortress, while the various human lands pay some amount of fealty to them (aka Europe, Egypt, Russia, etc). As you might guess, most of the Dragons live in Japan, with a few local species that adapted to live in the other continents acting as delegates.
A plague is engineered that is quite detrimental to the dragons, robbing them of most of their strength and locking them to their mortal forms. No longer able to change between forms at will, they suddenly lose a considerable amount of combat prowess. As the balance of power shifts, the Humans decide that this is their chance to assert their dominance and war breaks out.
The main character would be a Red Dragon from pseudo Europe (I'm running with the name Nalia right now until I think of something better). Her gimmick is that she's not exactly a nice person. Like, most of the Lords are 2 dimensional good guys which means they don't really get any character development because they don't have any flaws to overcome. Nalia, on the other hand, is very much a stereotypical dragon. She's greedy, prideful, vain, has a thing for princesses, etc etc. She starts the story locked in some forgotten dungeon for crimes she might not have committed. Upon hearing of this plague, she collaborates with a newly arrived Mercenary General (aka Jeigan) to break out. She helps rescue his troop from execution, and he serves her in finding a cure.
So for the first part of the game, Nalia would be played by a standard Lord, unable to transform until you cure her. As it would turn out, the cure is a very rare Dragon Stone; using it on a Dragon unlocks their Dragon Blood and gives them the Transform skill. I'm pretty sure that for a main character, the Laguz style of transforming is just way easier to balance. You do several rounds of combat and then get to turn into a super unit and wreck some stuff. Other items that you would acquire later in the game might unlock Wild Heart or even Formshift to let you transform at will. Otherwise, I like the idea that her weapon depends on the difficulty; Lances for Easy, Swords for Normal, Axes for Hard (because Wyrmslayer).
Obviously the first major goal is getting cured. Outside of that, Nalia has a 'Satisfaction' rating. She gains happiness from acquiring gold, getting supports with units in her army, and if the Princesses in her army meet a certain total experience level. So basically a flavored version of the Ranking from FE7. As the story progresses, she comes to the conclusion that she could be doing more important things than profiting from the war and the player will take a more active role in it's development and conclusion.
The game would be broken into a least 2 major parts. Nalia and other cured dragons are immortal, meaning they live a long time; these units would return for Part 2 set a generation or more after the events of the first one. As for your human units, there would definitely be a few child units. I also like the idea of certain characters having either Holy Blood or Dragon Blood, allowing them to use certain weapons and live long enough to show up in later sequences. With only so many Dragon Stones, most of the dragons would end up integrating with humans or dying out; the effects of the sudden decrease in the numbers of the dragon tribes (as well as which ones you decided to save) would affect how that part of the game would play out.
It's... very much an infant idea. A lot of stuff I want to iron out so they make more sense, there's concept art I want to draw, etc. I think it's kinda fun though, so...
The dragons ruling and then being stripped of most of their power actually happens in the Elibe world (FE 6 and 7) but it isn't a plague that does it but the human's divine weapons that throw nature out of balance which for some unknown reason made a lot of the magic in the universe go poof. If you wanted to do a manakete/dragon lord and have them not be nerfed to face normal humans you might be able to pull of a Scouring era game where you play as one of the Divine Dragons that sided with the humans during that war, and you could even have the demon dragon as an end boss or something since she made most of the war dragons near the end of the war. I personally think it would be neat to have, and the Al from the manga idea could work well