I'd like to see it go the way of the Spider-Man Clone Saga!! Hehe! Nah, I think they could seriously work with this new Phoenix idea. But one thing EVERY writer that writes for the Ultimate Universe needs to understand is that this is a universe of new possibilities.
It's like Kirkman said about everyone waiting for Ultimate versions of the 616 stories. That is lame and THAt is why I didn't want Gwen to die in the UU. There was more potential for her as Peter's big sister or whatever, than as dead meat for him to feel guilty over. Now we've just got another boring Gwen guilt trip Peter in another, younger universe!
Anyway, enough Gwen whining from me! Back to Phoenix:
I'd like them to make Ultimate Phoenix (the entity) an ancient Goddess type thing instead of a cosmic being. But now this entity has apparently possessed Jean Grey and is guiding her and using her for a purpose...but what purpose? (okay, I concede that we know all that already!).
So we cut to the ancient past when the Hellfire Club was formed by a group of aristocrats who wanted to attain power by bringing the Phoenix to life on Earth or whatever. They kidnapped a young woman named Madelyn Pryor and had the Phoenix possess her, but it had too much power for her feable human mind to contain, so she died or went insane instead.
The Hellfire Club just continued to exist throughout the centuries until now when they finally found the perfect host for the Phoenix in Jean. At first they tried to aid it in possessing her over long range (hence her prior insanity and such) but then, when that failed and time was running out, they simply hooked up with Charles Xavier cos he knew Jean and they slowly worked their way into getting the Phoenix into Jean.
The Phoenix became fond of Jean and started to provide her power upgrades and the like, but whenever she tapped into said upgrades (like when the X-Men faced Spiral) she also tapped directly into The Phoenix itself, and its thirst for vengeance (kinda like The Spectre at DC). You see, it wants to burn away whatever is wrong with the world/universe, and now its idea of right and wrong has been altered by Jean's perceptions.
Eventually, someone attacks Cyclops and shoots him. It looks like he's dead so Jean goes psycho on that person, tapping into The Phoenix. The Phoenix suddenly assumes total control over Jean and then goes on the hunt for all those people Jean would have seen as being 'wrong'. It could even confront Wolverine and try to kill him.
The problem would be that, as it is using Jean, the Phoenix is also eating away at her body, slowly killing her human form. Eventually Jean would be on the ropes and, at the moment of her death, The Phoenix would do what it did in legend. It would fly off to a secret location, burn itself alive, and then come back in a new form. The Phoenix itself would be free while Jean would be reborn (but still as Jean Grey).
Anyways...those're my Phoenix ideas that I just made up here, right now.