ok so, I've been working in blender and fine-tuning my skills. finding methods to do things that actually overcome some of the issues in the first post, so I felt I'd update.
it's still on-hold. blender has some limitations I did not know well enough to get around at the time. the major problems are:
1: dynamic text that doesn't abuse memory is kinda unstable. in blender 2.5 to 2.79 you can use a text object, but that renders the text from a vector curve, and seems to suck up processor and memory power. In 2.49b you use a .tga image font, the problem there being that when you transfer the game to a different machine all the text turns into '@'s , the fix is to go in and re-unwrap every single text field and lay it out on the @ in the image, which is not something most casual players will easily be able to do. theres another method which requires a bit more programming expertise and essentially costs 1 polygon per letter in some cases, it also requires an in game dictionary of words and phrases so as to cut down on polygons. it would be a ton of work. I studied text using the bitmap fonts and got it to transfer macghines by packing external files into the blend and the setting all paths relative by links that was the problem because the link is the textual location of the image file, so even if you pack the image, blender font engine is still looking for the bitmap ascii file at the original linked location which probably doesn't exist on another machine, so by making the links relative to where they are in the game engine now the text works on any machine.
also word wrap is something I need to program myself, as well as text window bounds, scrolling and such, it's likely it'll have to be some crazy videotexturemodule trick to make a chat box actually scroll and hide out of box text.
I made a basic wordwrap, but I can do better. the basic wordwrap wrapped based on the character width of a set number of fullwidth text characters "@" but for thinner characters it wraps each line short. so rather than setting a character limit per line I decided I'd have to figure out how much space each character occupies on width and make a dictionary of widths so wordwrap can be calculated by textbox width.
in the process of doing this a bug showed me that I wont need a video texture module trick to handle scrolling at all, instead I can just adjust which lines of text are displayed based on scroll percent.
oh and I made sliders. so scroll bars are a go. (I'm actually using them for a color picker window at current, but that needs to be broen down into smaller networks of game logic, separating red green and blue, because I hit some sort of bugged limit of how many logic bricks blender will actually show at one time, kinda bad when you select an object and look through it's logic bricks and say "I could have sworn it had a keyboard sensor, oh right it does, but it's not shown.. why? oh, I see too many objects linked together").
2: Dynamic shadows, blender only allows buffered shadows with a spot lamp. it also gets pretty pixelated over large distances. there's a gamelogic bricks function to make an object into a 2D n64 style shadow that follows the player around at ground level and hangs over edges floating in the air, and then theres theoretical raytraced shadows using a shadow scene and the render to texture module but it's not confirmed to work.
*Crazy Smile* my mad science works! WAHAHAHAH, so the green text is a go. I can render a shadow layer with copies of the models but in shadow color and use the video texture module to capture that camera's view (from each lamp) with an alpha transparent background and paste them onto a flat plane, then video texture render all those lamp reenders of shadow objects onto a single texture on the actual scenery. it has some limits but I've seen that lots of games hit the same limits.
Edit: I messed around with spot lamp buffered shadows, on my old computer they were always super pixelated and awful over large distances, not only that, the sourcecode that creates them does them in a different draw step over the top of the window, this used to cause buttons sliders and text boxes in the buttons window/editor to become graphically unresponsive (they still work, but the button slider or text graphic does not change while buffered shadows are active, so you couldn't see what you were doing), this is now not the case on this machine, I found ways to smooth the shadows over decently long distances, and they don't bother the buttons any more (must have been a RAM issue on my old computer.
3: Encryption. this was a real kicker. I think python has some form of data encryption module, but there doesn't seem to be a controlled method for key negotiation and exchange. I did make my own data encryption method the problem is building it lol.
still no progress here. I did reevaluate my message encryption system, it is valid. but I need to program a working example.
4: motion textures, blender can only do motion textures with the videotexture module, it uses essentially double the graphics memory and processor power as rendering the gamescreen then converts it to the desired image resolution. there's other methods I've stumbled upon more recently that should help essentially mesh swapping.
I practiced with motion textures, and finally got around to making some sphere-looping textures like fire. that was a challenge, but now I have a system for making sphere-looping generated textures. things like fire were a former issue for me in blender but now I can make looping fire without the frame-loop-reset flicker.
Edit; I've studied motion textures in blender, I know how to use image frames for animation now. I've been studying special effects recently I'm getting close to covering all the bases in game; Fire, water(ripples, splashes and player interaction), rain/snow, clouds, smoke, sparkles. I do need a better system for things like lightning or energies, some can be pseudo-particle effects, but many cannot and will need clever usage of geometry and animated textures.
5: updates, patches etc. while there are methods to do this automatically, you essentially need to build the updater into the game, and as far as I know it has some critical limits. real-time mesh and image creation are essentially a pipe-dream in-game. they are meant to be done out of game.
images can be swapped with the video texture module, communicating these images to other players can be done as well ( I found that out when messing with images in TKinter windows, there's built-in methods to convert an image directly into a data form which can them be sent through a socket gram.
The .blend can be saved from active memory, but can only be reloaded from file ONCE while in-game. a second time crashes blender.
that one reload is enough to display a created mesh or any other modifications to the game, sounds are a bit more tricky. sound updates will have to be a "update complete, please close and reopen the game" situation.
I'm at the point where I could almost START to do this. emphasis on start, as it'd be a long haul of a job to put it together. due to IRL I will not have time for quite a while though.