My oldest league is a local dynasty -- I've been in since 1999, and the league existed for 10-15 years before that. 12 teams, four divisions of three teams each, no realignments in the history of the league. Four division winners make the playoffs, no wildcards.
This setup is definitely a mixed bag. My division has been super competitive for the entire time I've been in the league. In fact, for the last five years running, whoever has come in second in our division has had the #4 record, but misses the playoffs anyway. That's a tough pill to swallow. I was the one stuck out in the cold in 2000, 2006, and 2007; thankfully, I've won the division each of the last four years. Two of those four, it came down to tiebreakers.
There are two pluses, however. First, it does build rivalry. Every year at the draft, the three of us are chattering non-stop about who's going to come out on top this year. And there's nothing better than trash-talking your divisional rival after that week 14 victory that sends you to the playoffs and sends them home.
The second is that I think it has kept the struggling teams more engaged. Rosters can get pretty lopsided in a long-running dynasty, which could lead to owner turnover. But in some of these divisions, all it takes is one home run to go from cellar-dweller to the playoffs. A rookie pick like Cam Newton last year, or a 2nd or 3rd year bustout like Rice and McCoy, or a free agent pickup like Arian Foster or Kurt Warner back in the day can put some of the worst teams right into contention for a playoff spot.
Sometimes I hate static divisions + no wildcards -- when I'm the one getting screwed. But on the whole, I think it's an interesting experience and adds some character missing in my other leagues.