I would 100% transition Colony Wars to Scroll3D. One of the main reasons the game is incomplete is the pain of creating the 2d graphics, each unit for instance requiring 12 different graphic frames:
It's not so bad for rectangular tanks, but it's not great for anything more complex, which is why I have not been adding new units to the game :-/
I have given thoughts to many of your points.
Firstly, I do not think there would be any big performance hit for fog of war. Scroll3D now handles this natively as you have seen in Terra Nova, there are just some bugs to work out (sprites can still be seen under the fog, as in the town names in Terra Nova).
It is true that the map editor would need to be reworked and that none of the existing maps would be able to carry over. Considering there are only a handful of maps, this is probably not a huge deal. The only downside is that the pathfinder would be slightly more expensive. For example, it is easy to say that tile x:y is not passable, because there is a cliff sprite there. With an actual cliff, you have to say that x:y is passable from this direction, but not if you are coming from this other direction.
A performance improvement could also be made by splitting the map terrain into chunks, say 8x8 or 16x16 tile chunks like MC2 does. Terra Nova does this and as a result will perform far better than My Empire did at large map sizes. This would just require that all map sizes be a multiple of 8 or 16, which is usually appropriate in computing anyway.
The larger model size issue is easily solved, in fact some work was done on in this regard on the Scroll3D engine when I added the Blockhead tokens class to the last My Tokens update, as those models are larger than 1x1 tile, and are wider than they are deep.
To easily animate, I believe each unit can have a base model, as well as an optional secondary turret model. The base model's rotation will be set in regards to the direction it is moving in, and the turret model's rotation would be set in regards to the direction it is firing. I was going to do something similar when I create Gone Rogue 2 using voxel My Tokens characters in the game, as voxel My Tokens are actually composed of three models, the body/head, and then each arm, allowing for arm movement (swinging swords, steering a go-kart in Token Kart, etc). So anyway, a Tank for example would have a model with just the bottom half of the tank, and then a second model containing just the rotating turret section. This same concept could work with structures also, for instance, a SAM site that shoots in specific directions.
In conclusion, I am 100% open to converting this game to Scroll3D. It is ultimately a far easier engine to develop for than Scroll2D is. I suppose the first step in development would be the complete rewrite of the map editor and the path finding routines. Most of the other code should carry over largely unchanged. Like MC2 and My Empire, most of the processing in Colony Wars happens on a separate thread that is completely divorced from the rendering engine anyway.