In terms of story I mean. I'd say they could've done (I would say could, but it's probably too late now) is instead of just being able to play as Liu Kang and Kung Lao (with Scorpion and Sub-Zero), they could've had, instead all the characters from MK2 could've been playable where you see the storyline in their game brought to life.

For instance, Liu Kang's storyline could start with you in Goro's Lair which ultimately leads to his fight with Goro for the Mortal Kombat champion, then later on in the second level, you fight with Shang Tsung. And he returns to the Shaolin Temple where he finds them in ruin and his story builds up from them.

Kung Lao's story could start with him at the Wu Shi Academy and trying to survive which ultimately leads to his fight with Baraka, but he has to run under the circumstances and then his story picks up from there.

Scorpion's storyline could start with you ruining through Shang Tsung's island as its collasping, trying to find the older Sub-Zero and when you do, you fight the boss of Scorpion's first level and then later on, you see Sub-Zero spare the life of the opponent and well the vow takes place here, (after you fight and beat the younger Sub-Zero)

Sub-Zero's storyline starts where you see him being assigned to finish his brother's incomplete task (You know I was never under the impression as to how he found out Scorpion killed his brother, since when you find him in SM, he seems to already know it was Scorpion who killed him)

And so on and so forth.

And each character's ending is basically a FMV ending of their ending from MK2, that way it would make sense if Shao Kahn was destroyed because that's what it said in the ending. Hey, at least this way we wouldn't be complaining about all the retcons (although I'm considering SM non-canon) of Shaolin Monks.