I've done it before. Keeping all the minors alive makes for an interesting personal goal, especially since they like to declare war on each other. One time this got me into a WWI-type situation as the near-defeated race I defended them from turned out to have a lot of allies.

I mostly like forming a federation of minors because if they're close or friendly with me (much less Allies), they tend to send their trade ships to my empire. I then give them trading techs, and often time, the starbases and freighters needed to maintain trade routes to my more economically prosperous systems.

One time I had the Yor as a major race, and the Dark Yor as a minor. Just for fun, I used diplomacy and conquest to take all of the Yor's empire, and give it over to the Dark Yor. I also gave them combat vessels (since minors don't seem to make use of them). The Dark Yor was stronger militarily and economically than some of the major races when I was done with them.

I guess being able to make a "Defense Pact" with minors should be added to the wishlist?