Personally, it's kind of drab to watch people standing on stage simply... singing.
Maybe some of you think it is interesting to watch.
... Hah, yeah...
A lot of animes [like the famous Melancholy of Suzumiya Haruhi] have a dance to them. The non-vocal should be given a chance; a separate contest for pure anime dancing skills. Even if the favorite anime songs don't have anime characters dancing then research could be made on the original music video. They usually have the artist dancing in those.
For the physically and vocally fit... they should enter both.
The regular karaoke contest requires you to bring a midi, which might be hard to find. The dance contest would only ask for the full, easy-to-get version.
Vote, then maybe the staff will get squabbling and eventually add it for '09, if not, I'll press for '10.
I'm pretty lazy so if there is already a dance contest intact... then, wow, would I feel stupid.