Good idea on the donations however if you ever decide youd like to free up the cash you spend on hosting let me know, ill give you space and bandwidth.
As for the donations, my suggestion is to simply go down to your local city office, register a business name should cost only about 10.00 then open a pay pall account and a bank account in the business name and put up a link, additionally you could rent a PO Box for those who prefer to send you cash or checks or just plain dont want to open a paypal account for themselves and post that information as well. Thats always been the easiest way i have done it in the past with boards I ran for donations.
Lastly if the MoCo decides to persue the case of the domain name legally, drop me a line, I know a few really good lawyers who specialize in domain name cases ( I went through the same thing last year) and I would be happy to pass on the information to you if you should want it.