Seska could have been used to much greater potential had any combination of the following occurred.
1. If she had kept her cover for much longer
2. If she had survived Basics, left the Kazon, acquired her own ship, and kept up with Voyager to menace them repeatedly (possibly keeping up with the ship by gaining advanced technology in ways that violated the Prime Directive, further developing the theme that Voyager adhering to Starfleet principles may be holding them back in their journey)
3. In combination with #1, if she had been a sleeper agent, like Illiana Ghemor, and some external influence from the DQ (or merely the passage of time) caused her true Cardassian memories to return to her more gradually.
4. If she had "come out" to the crew as a Cardassian operative, but maintained good guy status ("We're all stuck out here together, Captain. It makes more sense for me to cooperate, remain a member of Voyager's crew. Admit it, Captain, Voyager needs the skills I learned in the Obsidian Order.") Of course then she would betray them later in the series and it would sting more.
5. No obsession with Chakotay. That was pointless and gross. Even Chakotay seemed more embarassed about it than offended.
6. Somehow she should have been returned to her "true" fully-Cardassian appearance. Perhaps the Doctor could have surgically altered her in any hypothetical scenario where she had been outed as Cardassian, but remained in Voyager's good graces. I would think that would only make sense... Her Cardassian appearance may offend some on the ship, however probably less than if the continued to wear the face of the Bajoran Seska (who was probably a real person at some point, most likely murdered by the Obsidian Order).
Agreed. I've never really been fond of Seska, and I honestly think she was written poorly more often than well. She was a victim of how alien races tended to get the one-note treatment in later seasons - Klingons were always warriors, Ferengi were always greedy and silly, and Cardassians were always overtly militaristic or sneaky bastards who'd stab you in the back when it was convenient.
I think the third and fourth options here would have been a lot more interesting. I think Martha Hackett is a decent actress too, she just could have been given a more in-depth character to work with.