I'm so glad you like it!
The benefit of evolution is primarily to complete your pokedex - so bragging rights mostly. It's entirely optional.
Team Rocket Grunts appear every 10 wild pokemon encounters. Gym leaders + Elite Four can be faced at will but must be faced in order.
My house rules were mostly for trading and battling. For trading, if we agreed on a trade we just struck out the pokemon we gave up and added the one we accepted; it retained the level and xp it had in the other persons game. For battling, we used best 2/3 mechanic and any relevant modifiers based on xp.
If you have anymore questions let me know!