[T]he GM's strategy for this has been asking if any of the better/better-geared players want to sit out any fights so the others can be brought in for a fight. If not, the second-stringers generally get put on the bench for the entire night.
Now, obviously, I've got a vested interest here. My attendance has been less than stellar this last while, and I've found myself put on the sidelines all night. I've never really encountered that, mainly because I'm a Paladin Healer, a rather good one too, and it's only been recently that our healing corps have grown to double digits. Of course, DPSers probably have been feeling left out a fair bit themselves.
I'm wondering, how should a GM handle having too many raiders for a night? Bring the best, always, unless one of them wants to sit out, or swap people around at logical points, even if it might decrease the effectiveness of the 25 people in the raid?
I feel your pain, Kyri. I was a Holy paladin myself, but lately I just didn't feel as useful as I once did. Holy paladins have it tough these days. They can't heal on the move and they can't heal more than one person at a time: a huge disadvantage for the many mobile, splash-damage-happy encounters in the current endgame. I'm lucky enough to have collected a decent tanking set as a healer, so I've switched to Prot for the time being. Some of our tanks have gotten a bit burned out, so the timing has worked out well.
But not everyone can so easily switch roles, and in successful guilds like yours, people do wind up benched. It's unfortunate, but it's the reality of learning content. Your guild has only scratched the surface of Black Temple and hasn't conquered Hyjal. Until you do, your raids have to do what's best for progression.
I have to say I'm against the whole "volunteering to step out" idea. If a player didn't want to be in the raid, they wouldn't be there. Asking people to step out just puts the burden of the decision back on your members. It makes the players feel guilty for even wanting to go, and it makes those waiting on the outside feel even more like the kids who get picked last for kickball.
It's also a bit of a cop-out for the officers and raid leaders. They don't have to make the tough calls -- they can just wait 10 seconds for no one to respond and then continue on as planned.
You also have to consider this: Your best and brightest had to spend a lot of time, gold, and effort to learn the early encounters. They deserve the chance to farm them for the gear they need while they're spending the time, gold, and effort to learn the later bosses. And that's why no one is volunteering to step out.
A more honest approach would be communicating a real plan for filling raid slots. My guild, even though it's a casual environment, makes no qualms about bringing the best and brightest to progression runs. If you want to keep moving forward, you need a consistent team of individuals. Every encounter in Warcraft is about learning from mistakes and finding the best way to approach the challenge. You'd like to think that you can just tell someone what to do and what not to do, and they'll do it, but the reality is that the only way to really learn the encounter is to beat it in person. The most nuanced description of a boss strategy, complete with maps, diagrams, kill videos, and a puppet show, can't train you like the real thing.
So bringing in new people all the time is only going to slow your progression. You'll have to explain the fights in detail and there's always bound to be someone who doesn't understand it completely, or who does something so bizarre that no one's even thought of telling them not to do that. If you spend too much time on the early bosses in a zone, you'll never get enough attempts on the later bosses to learn those encounters.
It's tough for those who don't make the cut. That's why, once my guild's progression team has beaten a zone, we start cycling in new people to reward them for their patience -- but only if they've done the grunt work. If someone is out of mana a minute and a half into an eight-minute brawl, or putting out 300 DPS less than everyone else, they obviously have more work to do.
Your benched players should be doing everything they can to improve their gear and their play, through farming the Tier 5 content, reading up on mechanics and macros, and, yes, watching those boss-strat puppet shows. That way, when they have a chance to show your progression players what they can do, they don't disappoint.
Eventually, everyone who's earned a slot is going to get the gear they need. And in two or three months, everyone is going to be sick to death of running the raid that people are dying to get into today. In progression situations, that's what everyone has to keep in mind.