@RHCP That's a fair point. If there was an issue with someone dropping out or being very inactive and leaving their team-mates in a rut, I would have to step in and help things along (if they're in the middle of a mission). Hospital time, training time, an "off screen" mission and a few other things could all be used to explain absense.
@Draco I didn't consider using a levelling system, and will give it some consideration. Regarding learning jutsu - the same as in the series. Either being taught or self discovery, and a whole lot of training. As for the abilities people will have when they begin, I think I'll recommend people have one "main" ninjutsu or genjutsu they use. (For example, Shikamaru has his Shadow Possession Jutsu.) And of course, some level of taijutsu, ninja tools etc. People could use their judgement to sacrifice one area for the improvement of another. In the series, you're unlikely to find characters who are masters at everything. If you want your genjutsu to be excellent, for example, you may to accept that your characters taijutsu is weak. From there you can improve your character as the RP continues.
@Reader_Maniac I actually quite like the idea that the sign-up is the genin test, in a way. In their sign ups people can state how they did in the academy and on tests etc. Then I can use that to decide the teams.