I'm very grateful for JR's thoughtful posts!
And indeed, this discussion belongs much earlier in the year. It works the same with Bonneville Land Speed Record cars. Thas is another hobby -- if that's the right word -- where unlimited innovation is encouraged. Builders are also strongly encouraged to submit their plans for evaluation before beginning construction. Saves a lot of last minute disappointment.
That said, this forum becomes an archive of information for future reference, so I'll mention a couple of things.
Electric power transmission has been used in Kinetic Sculpture Racing (a human power sport). The rider pedaled a generator, and an electric motor drove the wheel. With no storage device like battery or capacitor in between, this is considered 100% legitemate in KSR. The debate started when a racer incorporated several large capacitors to "smooth out the power flow" or some such. Direct electric tranmission of power is common in our society -- used in railroad locomotives, for one thing. But for human powered vehicles, it has proven terribly inefficient.
Hydraulic power transmission falls in the same category.
It is hard to beat the roller chain for efficient power transmission. But for some of us, difficulties arise when we need to turn the power around corners, more or less literally. The solutions can be simple and efficient, such as installing pedals crosswise in the vehicle. Or complex, such as running the power thru a series of U-joints -- as in the commercially manufactured Conference Bike.
One solution we use all the time in KSR, is to run a bicycle chain in a twist. If the distance from hub to hub is at least a couple of feet, you can twist it 90 degrees.
About dispersement of energy in a carbon fiber flywheel explosion, I would expect a lot of that energy to convert to... A HUGE BANG!