Nah, there's still a god there. Byakuren mentions that she can feel that the god is angry (which she claims to be the reason that the shrine gets so few visitors), Rinnosuke says he knows the name of the god (although considering it's Rinnosuke...), and it can still give its blessing of youkai extermination through the yin-yang orb (which is its go-shintai, according to OSP chap. 17).
And yeah, the Shrine is a point connecting the two "worlds"; IIRC Reimu describes it as being like a wall separating two territories, at the same time belonging and not belonging to both places.
Meiling will be the super-secret bonus character that's unlocked after you fight the last boss with everyone else and lose. After all, only dragon-type moves are super effective against dragons.
Oh wait, and ice-type moves. Nevermind, Cirno will save us all.
The final stage will be in the Dream Masoleum, and after everyone gets defeated Cirno will rise from the audience and freeze the world with her glory.