I made it to the Elite 4, and wondered whether I should train my Pokemon some more as they were all at mid-level-40s. However, I decided to just go for it right there and then for a challenge.
It turned out that the League was fairly straightforward despite my team's level disadvantages. Lance's Dragonair's/Dragonite proved to be the most difficult obstacle for me (their Thunderbolts gave my Ice Beam using Blastoise major trouble), but I persevered and eventually got past them. Other than that though, I didn't have much problem conquering the Elite 4 and Gary.
I'm now taking a break from Yellow for a while, but plan to raise all my team a little till they're Level 50-55 in order to use them in the R2 Poke Cup on Stadium 1.