Can I activate Sinister Shadow Games if I have no Shaddolls in my main deck?
A player cannot opt to activate a card or effect with an apparently non-resolvable mandatory component.  By "apparently non-resolvable," I mean that if the card or effect were to attempt to resolve at the time of activation, it could not properly do so.

This means that Sinister Shadow Games cannot be activated unless there is at least one "Shaddoll" card in the Main Deck at the time of activation.  This reveals the second question to be meaningless.  However, if instead Sinister Shadow Games was legally activated, but when it attempts to resolve, all of the "Shaddoll" cards have been removed from the activating player's Main Deck, Problem-Solving Card Text can be applied to determine the outcome of the ruling.

Effects which take the form "Do A, then do B" are such that A and B are sequential components.  A resolves, then B resolves.  For effects worded this way, if A does not resolve properly for any reason, B should not be resolved either.  So if Sinister Shadow Games is activated, and an effect is Chained which removes all "Shaddoll" cards from the activating player's Main Deck, no "Shaddoll" monsters will be flipped face-up.