Ok, the best location in my eyes would to be from OOT, mainly because it is a widespread of opportunity and so the players are not forced to be so cramped up. Now, like I said, the characters would be from the mind, not characters that already exist (Link, Zelda, Gannondorf, Sages, etc.) You could base your characters from any of Hyrules inhabitants, whether it be a Deku, Goron, Zora, Hyilian, and kokorikian. You would live as any other that you have seen in a Zelda game, and what type of character you are is where you would reside. It would consist of conflict such as on the streets, in town, on the fields, anywhere really. You and friends could go upon quests such as scaling Death Mountain, Finding the Treasure in the Lost Woods, the possibilities are endless. Would you like me to continue?