To start, here's what we do. /roll. No master looter, no discussions, if you need it for main or or offspec, you roll. After all the rolls are out, we rely on our players to trade it to a main spec roll or discuss it among themselves who needs it the most, who it's the best upgrade for or whether someone has won a lot of items lately. Our view is that in a 10 man group, any upgrade for anyone helps kill new stuff or kill old stuff faster.
There are so many drawbacks to the LFR system that would impede gearing your group in a closed raiding environment, that I really can't see how it would be viable. Hybrids who heal half the fights and DPS half the fights would only ever get loot for the spec they were in for that fight. So if I'm the fourth healer on Morchok as a pally, I can't ever get the strength bracers. Combine that with the potential for one player to have terrible RNG and never get loot, or get the same piece repeatedly. I just can't see any benefits to the LFR roll system over just using a straight /roll that the game already provides.
Easy enough, if there weren't any benefits people just wouldn't use it. No harm to add it as an option (which, of course, is the only thing anyone has ever been suggesting).
Done properly I think it would be useless unless you were in a significantly unbalanced group - either your comp was strange (8 vanq, 2 conq, 0 prot isn't really all that uncommon) or you had a mix of people of radically different ilvls. Assuming a drop rate normalized such that the LFR loot system produced loot slightly slower on average with a balanced group you would always be motivated to use it in the case of balanced groups and only willing to switch to the LFR system in unbalanced ones.