This project would be a really big win for the Wikimedia ecosystem. I would also recommend you consider remote dumps as well. I've been building a wiki that monitors other wikis called WikiApiary. I recently added the ability to backup any wikis monitored by WikiApiary. It works great, and I'm using the dumpgenerator.py code from wikiteam. The biggest problem with this, especially since it is remote via the API is that it does not allow incrementals. Adding support for incrementals would be a huge win for this and would allow remote backup of thousands of wikis without undue load.
Topic on Talk:Incremental dumps/Flow
I'm not sure I will have the time to do this during the summer. I will certainly keep this in mind and try to make the code modular, to make adding support for dumping external sites using the API later relatively simple.
I might look into this after the GSoC ends.
Any news or developments on the issue of incremental dumps?