I like the idea of a "funny" section, which would probably included many threads about lolcats, but I really feel that there does need to be a genuine off-topic, and not just sections of extremely organized chatter. The unpredictableness and freedom within bounds helps maintain the community.
Also, I think that you may think that the situation is worse than it actually is. I've been on boards that have gotten out of hand, and while the occasional flame war that we have here is like fireworks, it's nothing compared to a forum that's really in trouble, like one I'm one where all the mods were kicked out...this forum's doing relatively good, I thought, even in the Angst corner, compared to forums with true flaming.
Poetry corner would be good.