Indeed the timeline UI in itself is quite some work I guess. Maybe
just implementing the motion path on-canvas helper with onion skinning
simulation could be more reasonable for this period of time.
Now that I think of it, it would have helped me to have an LPE editing mockup before I started. (more precise than what I had in my head) So perhaps you should (like you already did) start gsoc with as precise a UI description as possible. (for example also, who writes to XML, what will be written to XML, which XML changes should trigger an update of which widgets, etc...
That's seem a good plan of action. I'd like to avoid proposing
something that turns out to be a dead-end for future improvements
(toward full SMIL compliance), So a careful analysis is definitely
good. And making mockups would help getting feedback from
animation-aware users.