One other advantage of a flutterwumper as described is that nothing prevents multiple active tools. Except for some tool sized area at the center of rotation two tools would not interfere with each other.

One reason I like that is I've really been investigating using metal powders.
Some of you have seen in Make a blurb on printing in stainless steel http://www.shapeways.com/themes/stainless_steel_3dprinting_gallery. Now while using the tool to control Z prevents all powder based printing, it is still possible to extrude metal powder. Think about forming electrical paths through the model as it is being built.

Has anyone been able to devote some time/thought to this project lately? I'm busy now with outside work on my home (winterizing) and basement renovation, so personally I haven't been able to do much work on the project.

A bit, since it's in my garage, but I too have been busy lately.

I have some threaded rod and a few grooved bearings that may work really well for the project; I just have to start doing some things. Not likely to happen soon.

Check out the latest 2600: Off the Hook podcast with guest Nick Farr. and they briefly discussed the makerbot project at HacDC if anyone is interested.