I dont even want to make a direct mob arena. I want to make an oldschool style dungeon crawl. Full of monsters and the such. I'de hide chest all over the dungeon full of things to help people through it. Like weapons, food, potions, armor, arrows etc.
I'de make some trapped chests here and there that must be de-activated with a switch or risk blowing up, being ambushed by hordes of mobs or something.
If you have ever played the old Elder Scrolls games such as Daggerfall or Ultima Underworld, Doom, Heretic, Hexen, Dungeons and Dragons. Thats the kind of dungeon I want to turn an entire town into. Each person's "house" would be a safe room for them and them only.
Oh the possibilties.