I imagine what will happen is that when they hit the big 1000, they'll stop releasing whole generations of new Pokemon (and I'm sure they'll make a HUGE deal out of it), but they'll continue making new games with the Pokemon they already have. They can then devote their resources to balancing the game, making richer stories, and devising new modes of play. They'll probably make a couple new Pokemon here and there (most likely evolutions of old Pokemon), either as DLC or as a selling point for a new game.
