Author of PageKite here - funny to see this reposted yet again. :-) In case anyone has any comments/questions/... we're listening.
Also, if you haven't checked out PageKite in a while, the most recent 0.5 release fixes a lot of minor issues the older versions had, it may be worth another look, especially if folks are using Windows or aren't based in "the west" (we recently deployed a relay server in Asia, in addition to our American and European relays).
FYI: In Firefox 17 on Snow Leopard there's a "skip to navigation" link way to the right (like 10000px or so) that I can scroll sideways to on your homepage. I only noticed because I'm using a trackpad. :D
http://pagekite.net/wiki/Floss/FreedomAndPrivacy/ is what motivates me - PageKite is an attempt to bootstrap a peer-to-peer web where IP addresses don't matter anymore and servers can run literally anywhere, so people can actually self-host content at home without learning all about IP addresses, routers, firewalls, DNS, SSL, ...
I don't know how much bigger that is than your vision, since I can only guess what your vision is. :-) I can guess based on your design, that until now you haven't cared much about people using localtunnel for anything except dev testing.
Also, may as well publicly repeat my invitation to have a chat about standardizing a protocol around this kind of thing. You're rewriting everything anyway... bre at pagekite dot net. :-)
If I were starting from scratch today, I'd base off websockets instead of the HTTP chunked encoding as I did, but other than that I have been very happy with it.