A delete is a delete. If you delete a member, that member is then gone from your system entirely. The question is over what to do with their existing content (which is where you got guest from). All their posts would then become guest posts (attributed to nobody). You can choose to keep the name on the post during this process.
In terms of anything else, its simply moving them to a new group rather than deleting. You would be offering your members the option to deactivate their profile, rather than delete it, in the scenario you mention