The island had to be protected because of the light - it was in some (undescribed) way essential to the survival/wellbeing of all life. If the light was extinguished that would be very bad (exactly how we are not told).
There's also an implication that the light could be misused in some way (or perhaps people seeking to do so might accidentally damage it, much as it was damaged by Jacob). As such, the island needed to be protected against these people.
Unfortunately, something being dangerous does not mean that people will stay away from it (in real life or in LOST). In fact, the opposite is likely to be true, especially when the danger arises from some sort if power. The Dharma Initiative is a good example of this - although there was danger on the island, they were very eager to investigate it further (presumably with good intention).
Exactly what the protector could do wasn't established. However, it seems that they could set their own rules to an extent (see closing dialogue between Hugo and Ben). In Jacob's case, he could influence people outside the island such that their lives were altered (ending up on the island), and he could set constraints on the MiB/Smokey.
We only see a tiny proportion of the time that Jacob was protector, almost none of Hugo's time or Jacob's mother's time, and Jack is protector only for a very short period. That means that we don't really know what the protector is capable of, or what they have needed to do to protect the island/light. Most of our experience with Jacob is tied to his finding a successor and a resolution to his mistake with MiB/Smokey - in fact Smokey influences his time as protector extremely, and so earlier/later protectors probably behaved very differently.