I would have loved it if the Watcher's Council had been the big bad. I really was convinced the writers were headed that way after Season 3 but it never happened. I think they would have made awesome villains in Season 4 or maybe later.
After the events of Helpless, the Faith fiasco, Wesley and Giles getting fired etc, the stars just seemed aligned for Buffy to go head to head with them. I can actually see the Council going so far as to try and have Buffy and Faith killed, so a new, more "controllable" slayer like Kendra, would be called.