Huehuehue, me likey when the peoples' red-water come out. 8D

On a more serious note, sounds good - people should be punished for/when/if they do something that is not in-character but rather the 'best' choice at the time - or always being able to tell if someone is lying, seeing through bluffs and/or knowing when someone is tryin to deceive them, even when they have no logical or background-relative reason for being able to do so.. Playing a video game and playing a different personality in a story are not the same after all. :p
As for Co-GM, you should probably pick someone who is active, is good at keeping secrets and has a firm grasp of english - and can make themself understood in said language. Of course, that may be difficult to do until [i]after[/i] the roleplay starts up... ^^;