I think one could use a camchain and friction won't be that much of a problem... the biggest challenge will be to create the 1:2 ratio... therefore the chain need to run over the small 8 tooth gear (and 16 tooth gear)... I don't know how well the 8-tooth and chain works? But would be worth a try.
You need write a small LUA-script to create the animations in LDCad, which in principle is not that hard... however there are not many tutorials (search for "LDCad animation tutorial" on youtube to find a few) and documentation available, which makes it hard. Do you think people would be interested in a "how to"-tutorial of my animation?
I saw that the creator of LDCad also made a program for animations http://www.ld4dstudio.nl/ but it only works on windows :( so I haven't tried yet.
Yes, I was inspired by this set https://www.bricklink.com/v2/catalog/catalogitem.page?S=858-1 and also the V2-engine of the Fat Boy (https://www.bricklink.com/v2/catalog/catalogitem.page?S=10269-1) (I really liked it, because its more fun to build everything out of generic parts)