Yes, they have plans to eventually add in the rest. Right now they want to see how it'll work with the originals, plus given that it's #Pokemon20 they thought it'd be a good idea to reacquaint players with the 151.
there's coding in the game for the legendary birds and mewtwo etc., so these pokemon might be released after it's available world-wide. so yes, there will be legendaries, and also new gens in the future.
The plan is, getting you hooked on the gen 1 pokemon so you're like "I can cope with catching all of these" but after a little bit they add the rest slowly and make you pay out $$ for it so you can buy more pokeballs because they don't give you enough.
Gen 4 is my favourite just because it was the one I grew up with. My sister was a huge fan of Pok?mon, and her room was covered in the stuff. She didn't like me all that much and to try and build a friendship with her I tried to get into the same things she liked, which included Pok?mon. So, when Diamond and Pearl came out, I got them too and I guess I accidentally liked it, regardless of whether my sister still hated me or not.