This is a big old post about dramatic structure, and some notes on plotting stories for tabletop games. I got wordy, but hopefully it's helpful? :Y
I don't think you
need demigods, do you? You could just roll mortal players, and attach them to factions as a way to drive the quests and action of the game; the players are given jobs/quests that further the goals of the faction they're given quests by, like getting macguffins, finding missing persons, assassinating rivals, making wildernesses safe, maybe eventually doing things for the deities that the deities themselves can't do (say, for fear of the repercussions of violating whatever Prime Directive sort of treaty they may have with other deities)?
As a GM, you probably do want to set up enough of a pantheon to structure the setting, and maybe create some non-divine factions (guilds, rebels, acting troups with shady dealings, whatever), or factions that have members who bridge multiple other factions, each with their own goals in mind. They don't have to be Epic Plot Goals or Politics either; just things that could cause them to butt heads with some people and work with others. Maybe they're competing over resources, plotting personal revenge using their faction or allies, pursuing love, resolving an old rivalry, or whatever else. Good, meaty, basic human drama stuff remains some of the most exciting and relatable for people, and is always good.
And yeah, you'll eventually need general ideas for settlements or locations, maybe a handful of NPCs who will be driving the early plot (early plot is for teaching the players about the setting, getting a feel for their party, and letting them get their feet wet). That could possibly wait until after character creation, though, once you know what sort of game your players want to play, too.
If it's something you'd like to try, I think a lot of the structure for the setting and plot can come from the character creation process. You'd want to introduce the setting and some of the major figures to your players first, and then you can answer questions and create characters with them as a group. Players could affiliate themselves with existing deitites, or you could let them create their own rough concept for a new deity (you will probably want to build most of the details and secret goals of said deities/factions yourself though), or you could even let them start as independants somehow. But yeah... players building personal histories, creating various social ties between their characters and other players, and between their personal rivals and allies, is something that can provide a lot of fuel for the plot and setting you're building. You can connect those rivals and allies to more NPCs/factions of your own design through ties of friendship, rivalry, love, blood or whatever.
Resolving personal stories and goals for your players is good fodder for plot, but if you want a backdrop of a Big Damn Heroic Story to support it, you probably want to come up with a major conflict that they're trying to avoid or overcome. Sleeping gods or climate change or whatever. If you're looking for more of a Central Antagonist story, you can eventually connect NPCs the same way players connect to them (blood, love, revenge, whatever), and trace a web of various associations leading to a main antagonist, or an antagonist faction; death gods or a sick-and-tired Mortal trying to overthrow the whole deity/avatar system, or something less Traditional Epic Fantasy like surviving and rebuilding after a cataclysm or fall-of-an-empire scenario, leading a revolution, or whatever. And you can build a plot that traces the characters along those social connections, revenge plots, etc. from character to character, until they discover the big conflict or villain, or the shit hits the proverbial fan with the big crisis, and then they have to resolve things. Whatever would create a game and theme you'd find interesting to run, and the players would find interesting to play.
A few last things; you could take some notes from traditional plot structure too, to shape your story once you have a feel for the players and the story you want to be telling. Speaking generally, there's the traditional
Three-Act Structure often talked about when looking at stories and dramas, though some people break it into 4 acts:
Four Acts In Point Form
Act One (first 25%)
- The inciting incident occurs (/the hook).
- Establish the (initial) stakes.
- The lock in: something happens to up the stakes just before we break into Act Two.
Act Two (25% to 49%)
- The hero comes up with a plan, a way to solve the problem or a way to approach the problem. If this is a murder mystery, it is a way to find out who is the murderer.
- Put the plan into action.
- The plan fails. Everything the hero and his companions thought they knew was wrong. Back to square one.
Act Three (50% to 74%)
- The hero and his/her companions tries to recover from the calamitous events of Act Two. They try to come up with a new approach.
- Everything keeps getting worse for the hero and his companions. The opposing force increases.
- The stakes are raised.
- By the end of Act Three it seems as though the hero has lost.
Act Four (75% on)
- New plan
- Solve the problem.
- Attain the goal.
- By the end of Act Four equilibrium is restored and we're back to the Ordinary World of Act One, ready for another adventure.
P.S. Heroic Stories and the Batman Reboot Trilogy:
Heroic stories are often done in trilogies that roughly trace 1) the creation of a hero, 2) the fall of said hero, and 3) the redemption of that hero. If you look at the recent Batman reboot trilogy, you have a film about Bruce Wayne swearing vigilante revenge against the rampant murderers and criminals in his city, training in martial arts, gathering tools and resources and allies, and becoming a hero by saving everyone from some megalomaniacs. Then, we have a film about him meeting the Joker, who tried and failed to subvert who he was (trying to engineer his heroic fall); on realizing he couldn't do that, the Joker instead corrupted one of his best public allies into a villain (the lawyer Harvy Dent), and Bruce ended up having to sacrifice his reputation to protect his legacy by taking the blame, falling from grace, and becoming "the real villain" in the public eye. The last film saw a fallen and tired Bruce getting bested by a villain who was his match physically, mentally, and charismatically, such that he was too injured and emotionally tired to continue crime-fighting; after running away and some plot happens, and he has a cathartic moment of reawakening, he gets back in the saddle, and fights a last desperate fight to save the people who hate him, and defeat another megalomaniac, redeeming himself in the public eye, securing a safer future, and finding a protege to take over the fight for him and allow him to retire. Heroic creation, fall, and redemption.