I expect that preventing a 51% style attack on any alt coin used will be necessary?
So that would mean that any coin used in the sidechain would have to be a coin that is potential competition for BTC too?
51% attacks only affect blockchains, not assets/"coins".
Ok so lest say "donkeycoin's" blockchain was being used, and there was a 51% attack on "donkeycoin". What are the possible implications?
You mean a 51% attack on donkeycoin's blockchain?
Then assets within donkeycoin's blockchain are susceptible to reversal and/or oversight/control by the 51% attacker.
If the attacker achieves 66% (or whatever the configurable threshold is for the sidechain), then they can also begin to steal outside assets pegged into that blockchain.
The donkeycoin asset/coin itself is irrelevant to this, and may or may not exist.