Well there is a few options I was thinking of to deal with how many people are interested. Those who have played in my PbP's know I keep the player group to around 5-7 people. So obviously I couldn't select everyone. But these are two ideas I had that we might be able to use. Possibly even both?
1) Recruit a co-dm to run a second team and help with things. SirP actually was my co-dm until I had to deal with real life stuff and drop gaming for awhile. If the right co-dm was selected this could work very well, and lead for a exciting team vs team game.
2-a) Let the players who have made characters but weren't selected, fight in battles. Meaning basically letting people bring in there character to one of my encounters and try to kill my player group.
2-b) Letting entire teams come in and fight the players group. They wouldn't get much role playing in, but at least would get to use the characters that they labored over for so long. Even if only briefly.
Don't get all gung-ho for the Arcana games yet though. My current PbP wont be finished for many months. I'm guessing some time around june-july? Depending on how fast they figure things out. So far due to the holidays and real life issues we got off to a slow start. I'm hoping the pace will pick back up now though.