Proceed with caution. Here we go:
----
Luffy's POV: Utilizing FS from the start
Maxing out his FS, Luffy realizes that every possibilities of the Future if he try to fight Kaidou, is death. Not just his death, but the massacre for his comrades first (imagine seeing Zoro, Sanji, Nami, Robin, Law die in front of him, their bodies exploded into meat juice as Kaidou deathblitz them all, with just a single move, his speed to kill them less than a hundreth of a second.) and he saw his own death the last. This emphasizes both Luffy's FS and also Kaidou being WSC. The win-win solution for hyping their future battle.
Luffy will wreck his own brain lightning-fast to bring his friends to some hideout in Wano first (before Kaidou closing in on them) instead of even encountering, much less confronting, the WSC directly. His friends will be confused as Luffy seem to know which way to go to and which direction to avoid in order to finally escape something that they havent even sense yet, which is Kaidou's presence and attention.
---
Luffy's POV: fighting Flying Six and All Stars
- Luffy shouldnt even participate in fighting any Beast Pirates, instead relying on his friends to fight them, and save his strength only for Kaidou since the start. Zoro, Sanji, Law, Kidd all shine in the battle against Top Officers of Beast Pirates. While during their movement to reach Kaidou, while Luffy's mind should've gone through constant image and internal training, improving his rubber-based abilities and attempt to give elasticity to his Armament Haki or Conqueror's Haki as well.
----
A rough sketch how i prefer the Raid War compared to the canon
Since the beginning, all the strongest fighters in the alliance goes all-out and attack Kaidou. No one can even touch him due to Dragon Force: Kaidou's permanently-active CoA that he obsessively trained and hardened for decades since infant, acting as a body armor, millions of times stronger than Bari2 No Mi. The reason for his title, World's Strongest Creature. No one can reduce his lifeless boredom, emptiness, no one can force him to move an iota from his standing ground. Until he senses Luffy's presence.
Sensing this, Kaidou orders his subordinate to make way for the boy, and get away from Wano Country itself, to the seas, as far as they can. He also tells them that if they haven't finish the Strawhat Alliance by the time he's finished with Luffy, he'll kill them all himself.
With that order, the entire Beast and BM Pirates and alliance pirates sail to the ocean and start the war as tactical naval battles before boil down into group fights and 1v1s. Marco vs King aerial fight (flashy fireworks in the sky), Sanji, Usopp, Franky vs Queen with tricky sea battles.
Kyoshiro (Wano's 2nd strongest swordsman) and Zoro vs Orochi, whose Hydra form is actually very strong and resilient and also able to swim in the sea, even stronger than King, and also very cunning. Zoro also find that Orochi is apparently the best swordsman in Wano history, his sword techniques are far higher than his. Zoro can't even predict who will be the winner of a swordfight between Orochi and Mihawk if they are to meet in a battle.
Orochi kills Kyoshiro in the battle. After that, it becomes an underwater battle between Zoro and Wano's strongest swordsman who is also a sea monster, creating seawaves as high as mountains, one hydra head being cut but regenerated, rinse and repeat. But Zoro manages to awaken demon spirit Takemikazuchi as the Lightning Sword Deity, his unique CoA manifestation, and cut all nine heads at the same split second).
---
Strawhat Crews and 9 Scabbards vs Flying 6 and Numbers etc. Many casualties, many deaths from Heart Pirates, Kidd Pirates, Scabbards and Minks, many betrayals and backstabbings and double-agents etc. If we want some more gutpunch, Nami dies after being tortured by Beast Pirates and CPO Agents, replaced by Jimbei (can both steer and navigate, and also had inherit the incomplete map from Nami).
---
The only ones left in Onigashima are Kaidou and Luffy. Kaidou questions BM if she wanna die as well since she doesn't leave. BM says she just wants to watch since it's too risky for her to interfere in a battle between two guys that are seemingly dead equal as two WSC's. Kaidou says he recognizes BM's intention to kill whoever is left, and hog the glory for herself. But he cannot simply ignore the ultimate threat that is standing before him, Monkey D. Luffy. The boy already has Poseidon as his ally, Kaidou can't let him take his daughter Yamato just because her capabilities in Poneglyph reading and mystic arts.
During all this time, Luffy just stands perfectly still, his eyes closed and his mind for the billionth time simulating the fusion between Devil Fruit's Neural Awakening and Skysplitter Conqueror's Coat.
The boy opens his eyes, BM floats in the sky with Hera's cloud then she says "Begin."
Both Kaidou and Luffy leap forward meeting at the center, the first clash alone splitting the sky and disintegrate the giant skull at the same time.
---
Big Mom departs from Onigashima, leaving Luffy and Kaidou. Law, Brook and Wano samurai ambushed her, but Big Mom kills he majority of Samurai. Law and Brook vs Big Mom (operation hax vs soul hax). Law is beaten by Big Mom's raw strength. But then he sees an opportunity of BM's recklessness and arrogance, stealing her heart at the most critical moment while BM neglects her own defense completely.
At the same time, Brook is getting helpless due to attacks of Prometheus and Zeus / Hera. But in the brink of death, he goes through Awakening and use his possession ability to possess the soul of Soru2 no Mi (inside Big Mom's body) and claim her soul-based powers as his own.
Suffering extreme shock due to her Devil Fruit powers being robbed, Law crushes her heart and kills her instantly. Yet, the damage Law suffers is too great, and Law dies shortly after. While Brook becomes the True Soul King, with the new power of an Emperor.
---
No intervention in order to hype up others
Luffy vs WSC Kaidou, is the battle for PK. Just like Zoro vs Mihawk is a battle for WSS. Oda shouldve make it clear to everyone that Luffy vs Kaidou is not a battle they can interfere without their own death as the only result. Make Kaidou oneshot Zunisha as revenge for Zunisha oneshotting Jack, so everyone recognize that Kaidou is an existence with an impossible powerlevel beyond their imaginations. Make Kaidou state "This is first warning, and also the last." or something signifying that he, Kaidou, holds the life and death of the whole alliance, at his mercy.
Oda can make Orochi as an extremely proficient swordsman who is also a menacing hydra etc, for Zoro to fight against, for example.
While Kaidou can be designed to create his own powers with mystic sacrifices or absorbing a hyper mythical artifact or something and assimilated its powers with his own, Original Titan powers or something, something worthy of WSC. Whatever, doesnt even have to be a Devil Fruit in order for Kaidou to achieve his WSC status, Oda can always find another way actually.
---
Earned powers, Earned Loss
Then after this much preparation and build-up, Luffy can earn his powers, he can battle to his heart's content, THEN he can lose. I agree that Luffy shouldve be beaten in Onigashima battle against Kaidou. But only with point 1-4 fulfilled. Not without. So Luffy' Onigashima defeat shouldve been his first and last, against Kaidou. No fake tension moments, no empty hypes, but an actual WSC and earned powerup, also Luffy becoming the one we actually root for to win an impossible fight, and he lost after all. A whole-hearted defeat that happen even after Luffy prepare himself to the utmost.
---
In the moment between life and death, Luffy finally create something never seen before in this world. Luffy rubberize his own Conqueror's Haki and insert it into his body's dimension, allowing him to move and attack massively faster than speed of light, faster than time, something only someone as creative as Luffy is capable of. Using this new created ability, Luffy defeats Kaidou. Kaidou dies. That day, Gomu2 no Mi is also erased from existence, sacrificed to create Luffy's new ability. From that moment, Luffy gets permanent FTL ability but lose Gomu2 no Mi, opening the possibility for him to get new fruit.
---
The contender saves the day
The day after the battle, Luffy and his friends can't fight. Greenbull comes to take Luffy' head. This is where Kidd saves the day. Kidd undergoes Awakening and his Devil Fruit becomes Gasha Gasha no Mi (Assimilation Devil Fruit). By this, Kidd is chosen by Pluton to be its master. Kidd (controlling Pluton) kills Greenbull, and then rides Pluton to the next island.
--
So there, i tried.