So, I have some experience at running this kind of thing.
The number one thing you have to worry about is time. If you have people posing each blow, it will take forever to run. What I'd suggest you do is determine the result of each fight before it happens, and then get the participants to pose three or four poses each, perhaps one for "the buildup", one for "early stages", one for "later stages" and one for "aftermath".
Your multi-channel setup seems good, I'd have one for OOCly sorting out mechanics for you and the participants.
As to how you'd determine results - get the opponents to describe their character and skills, if they can agree who wins between them, good, if not, make a judgement (a score out of 10, say) of the likelihood of which of them being a victor - so, for example, you say 4/10 for participant A, 6/10 for participant B (they should add up to 10) and then roll a D10 - 1-4, A wins, 6-10 B wins. 4 vs 6 is pretty close, so you'd probably have a good fight. 2 vs 8, then if 2 wins its a lucky shot, otherwise it's a fairly straightforward victory.
That's how I'd run it anyway. You have to keep it moving or it's going to take hours and hours and hours. I'd expect it to go 4 hours anyway, assuming you get a reasonable number of participants.