That all sounds good, But, (granted this probably isn't likely) what if Elemental is huge flopping failure and doesn't sell well? What would be the draw of buying or making expansions? I'd rather them add as much as they can to the base game and then Expand the Storyline in Expansions. To me a "Expansion" should continue the storyline. If the Expansion Pack for Dragon Age hadn't continued the story I doubt I would have bought it.
Expansions should have more then just eye candy and goodies if they want to sell. Gal Civ 2's expansions almost all of them added new play features and gameplay changes (mobile Starbases were added in a expansion weren't they?)
The campaign goes like: Life Sovereign vs Death Sovereign. Soap opera here and there, wars, racism, treachery, spells of mass destruction,... and the big finalle. One side wins. End.
Considering that the spells of mass destruction will be included in the base game, I don't see why they would cut the story in the base game so they can continue it in a expansion (see also your comment of possible holocaust that would provoke Elemental to fail epicly in release and forbid us form expansion). Also, comment that the Lore from Elemental will be used for other future games of Stardock (like the RPG) so it's not like they are going to give up easily. And I doubt all those games would be based around the same theme: "Life Sovereign vs Death Sovereign. Soap opera here and there, wars, racism, treachery, spells of mass destruction,... and the big finalle. One side wins. End." Well, ok, some of those elements will surely repeat...
Expasions don't need to add story/campaign and can perfectly be just more eye candy. In fact, some people prefers the idea of individual micro expansions of different content so they can just pay for the parts (eye candy, new game mechanics...) the want to use. Also, at this point any Expansion pack thought is pure wishful thinking, so who cares?
Edit: the campaign could perrfectly lead to an aftermath scenario for expansions but they NEED to destroy some core rules from the base game so as long as that happens, anything is possible (expansion-wise)