Comments and questions.
Interesting subject and design. Are you planning a PCB-design? Let me know if I can do something on that.
You mentioned the expensive audio transformers. Do you have any idea of the costs of this design (so including supply and enclosure) compared to the cost of that transformers?
Drawbacks of the solution may be the need for power, the cubic measure and the adjustments. I ever "solved" the latter by going digital using delta modem. The quality was pour due to the low sample rate and other restrictions but good enough for speech like for telephone.