OK Kenny.. Here is what my Dynasty league does (after a little trial and error). We have 18 teams, so that may have some effective differences, but probably not.
25 man teams with a 5 man minor league system.
H2H points league
Weekly locked rosters starting C, 1B, 2B, 3B, SS, OF, OF, OF, DH, P, P, P, P, P, P
(sidenote, we do weekly rosters to stop streaming and all pitchers are treated equally).
Draft order is set by total points during the fantasy playoffs, with playoff teams getting the final 4 picks in reverse order of finish.
Any player still eligible for the rookie of the year award may be held in the minors.
Players moved to the major league roster can not be demoted again unless they are demoted by their own team (so if I brought up Lowrie I couldnt send him down later in the year)
Minor league players MAY be on the major league roster
Veterans who are sent to the minors are NOT eligible for the minor league roster (Liriano, Myers)
Unlimited IR slots, but any player added from free agency must be on the roster for 14 days before being added to the IR (So people dont snap up every injured player off the scrap pile)
No limits for position. You can keep as many backups you want at each position
Players kept on the IR for longer then 3 days after coming off the DL OR ineligible players on the minor league or IR may be claimed by another team. If a player is claimed you either lose them or give up your lowest remaining minor league pick.
Players drafted during the current season are not eligible to be added to any roster and must be presented through the draft system.
On January 1 you must cut your roster down to 20 major league players and up to 5 minor leaguers.
10 round draft, 5 major league spots, 5 minor league spots.
For each minor league eligible player you keep (outside your 20 keepers) you sacrifice your lowest minor league draft pick. If you have lost a pick or traded one you are only able to keep players for each pick remaining (so if I lost 1 pick I can keep 4 minor leaguers)
You can keep a player for as many years as you want
Following the draft all players are placed on waivers until opening day. (so if you come out of the draft with only 23 players you have to use a waiver claim to add more).
Minor league eligible players on the major league roster or drafted during the major league draft may be demoted freely.
Open free agency during the season.
You may want to drop the raid option, we have it in our FB league and luck the extra intrigue, even though no player has ever been raided, just picks.
To give you an idea of how to work with the minor league roster, I thought I was out of it this year and dropped some of my backups to add a couple minor leaguers to my major league roster. Now that the season is over I will keep one of them using (Gamel) rather then a guy like Bailey. If I wanted to keep both I could use one of my 20 on Bailey and keep Gamel with a minor league spot.
We also encourage the drafting of minor league players during the major league roster. If, for example, you would rather take Wieters last year then a MLB player like Luke Scott you could, then just not take that last minor league player (or keep him all season on the MLB roster).