The plot could start with Naruto and Itachi being lost in a strange dimension which turns out to be the world of Fairy Tail. At first, the Fairy Tail members are cautious around them. But as they see Naruto's loyalty and Itachi's strength used for good, they are welcomed. They could participate in the Grand Magic Games. Naruto would be excited to show off his skills and Itachi would be more reserved but still very effective. Their presence would change the power dynamics in the guild and lead to new adventures against powerful foes.
Naruto's powers, like the Rasengan and his ability to summon toads, would be seen as very unique. The Fairy Tail wizards would be both amazed and a bit confused at first. Itachi's Sharingan would be considered extremely powerful and perhaps a bit terrifying. His genjutsu abilities might be mistaken for some kind of dark magic at first. But once they understand that Naruto and Itachi are on their side, they would be respected for their powers.
His character could be developed by showing his adjustment to the Fairy Tail world. He could start off as a loner, but gradually open up to the members. His backstory as a ninja could be explored further in relation to the new environment, like how his past actions affect his new relationships.
One common theme is power exchange. For example, Itachi's unique ninja abilities might be compared or combined with the magic in Fairy Tail. Another theme is friendship. Itachi, who has a complex past regarding relationships in Naruto, could form new and different friendships in the Fairy Tail world. For instance, he might bond with Erza over their shared sense of justice and protectiveness towards their comrades.
In a scenario where Itachi joins Fairy Tail, it would change the power structure within the guild. His skills are on a different level compared to most of the members. He could form unique relationships. For example, he might have an interesting interaction with Erza, as both are strong and strategic fighters. His presence could also attract new enemies or old foes from his ninja past, which would put Fairy Tail in the middle of some intense battles. But overall, it would be a great addition as he could bring a different perspective and a whole new set of abilities to the guild.
One interesting story could be about Itachi somehow ending up in the Fairy Tail world and using his Sharingan to help the guild in battles. Maybe he teams up with Natsu and they combine their powers in a unique way.
In that fanfiction, it might be designed that way. Naruto has incredible powers in his own series, like his various jutsu. If translated into the Fairy Tail world in fanfiction, his skills could potentially make him very powerful. But it also depends on how the author of the fanfiction interprets and balances the power systems of both universes.
The Sharingan in such a fanfiction could be used as a tool for a Fairy Tail character to gain an edge in their battles. They might initially struggle to control it, but as they learn more about it, they become a formidable force. For instance, they could use the Sharingan's genjutsu abilities to deceive opponents in the Fairy Tail battles.
One popular type of Itachi Uchiha Fairy Tail fanfiction might involve Itachi using his Sharingan abilities in the Fairy Tail world. For example, he could use it to analyze and counter the magic of the various villains in Fairy Tail. Another aspect could be the relationships he forms with the Fairy Tail characters. Maybe he becomes friends with Natsu and helps him control his power better. You can also look for fanfiction on Archive of Our Own, as it has a large collection of such crossover fictions.