A lot of you guys are treating the Pokemon like mere animals, where in the anime and games, Pokemon are shown to be sentient beings. Meowth, a common and typical Pokemon, has shown to be a sentient being, thinking instead of acting under brute instinct. Real cats can't think and analyze situations, and many other Pokemon are shown to be of equal or higher intelligence than that of humans. Sure, not all Pokemon are that intelligent (such as Gyarados mindlessly destroying things) but that doesn't mean all Pokemon are like that. Pokemon defending their territory isn't such an animal thing; if someone walked into your house, you'd be pretty pissed off and want to get them out, right? I think in a world with Pokemon, there would be coexistence with Pokemon. Pokemon would have no real reason to attack humans constantly, unless we were destroying their habitats, and we sure as hell wouldn't attack Pokemon, considering nearly all of them could kill us in an instant. You wouldn't go out of your way to kick a Rattata and in return have it HyperFang your neck, would you? We'd each stick to our own homes, and that would probably be that. Trainers would also probably not exist, as Pokeballs couldn't exist for reasons already discussed. I think instead, Pokemon and people would be more likely to either leave each other alone or become friends, or maybe just develop a beneficial relationship, such as humans providing food for Pokemon and in return get services, like Machop helping on construction sites.
I'm loving this thread, it's great food for thought!