When I used to be part of a team of a small ORPG (with ~20 active users - we never advertised the game because we didn't want alot of users until the game was nearer to completion - which it never was), we were always available hanging out, chatting, running events, etc...
The key is making it so easy for moderators to run them, and make them flexible enough for moderators to tweak them.
In our ORPG, we (me and another developer) had implemented ~7 or so minigames using the lead developer's (and sole programmer's) scripting hooks into the server (we crashed that server an innumerable amount of times ). Those took alot of time to script, but could be easily ran whenever we wanted. And we'd often participate in the events also, without cheating.
Another thing we'd do is just spawn monsters in a non-PVP area for fun. Everyone loved that, actually, because it basically created an impromptu cross-guild no-PVP mass battle.
Spawning monsters we also just a single command away.
One thing that helped, is we could execute script commands directly in the chat box, while in the game. Things like: SpawnMonster(GetLocationOfPlayer(GetPlayerFromName("my name")), monsterID) ...to spawn a monster of a given ID at my location.
And we could then assign that to a hotkey.
Or we could assign something like: "ExecuteScript(1027)" to a hotkey.
This is the same scripting system we used for player skills, quests, events, dungeon bosses, etc... All fully-exposed for our abuse.
Having a flexible system is important, followed by making it easy to interact with that system (if appropriate admin privilege level) while in-game.
In a larger game, there should be a dedicated team of ~10 moderators just for that purpose. An 'event' team. Perhaps some recruited from the community, but many need to be full-time leaders who have actual server access.
Also, you can't really give out gear as prizes, or it'd just overpower people and make the game less enjoyable for them. So players should be given consumables or cosmetic items, or no items at all.