The interesting thing about Khan, here and in "Space Seed", was his loyalty to his crew. If trek movies really need a superbad supervillain, then a motivation should also be provided. And two times out of three, the reboots used "revenge", combined with "madman", which tends to grow old before the first viewing. Khan's desire to see his crew saved (even if only for use in world conquest schemes) was a welcome addition that would have been much harder to pull of with any other character. Any Trek fan would know of Khan, but most would also be immediately up to speed with this frozen hostages plot twist.
The execution of ST:ID is one thing. The choice of Khan was perhaps predictable, but the use of Khan was inspired here. And the concept of two villains, fighting each other with the hero merely caught in the crossfire, would have been excellent for any movie where the hero is still wet behind the ears. The second outing in the Young Kirk Series therefore was quite ideal, and seeing the hero played for sucker by the two veteran wrongdoers made great dramatic and contextual sense.
Could the movie have been done without Khan? Certainly: Harrison vs. Marcus would have met the caught-between-two-professional-monsters criterion, too. We'd just need some Harrison-specific reason to feel at least halfway sympathetic towards one of the monsters. And the bit where the seeming good guys get the blame for the death of family was already used up in the first movie.
Timo Saloniemi