Looks like fun.
If I was putting gears in frame rails, I'd copy some elements of AndyMark's assorted
Nano Tube products. They use 1.5"x3" tube to fit two gear stages inside the tube. If I was doing that, I'd probably either run chains inside the tubes (easier with the bigger tube) or do a full gear drive. Then I don't give away the space taken up by the pulleys between the wheels and the rails.