I think you'd want to get demo of crosschain p2pt running before asking foundation to fund it, if I see repo with sensible code, I'll even help you. The wording in the paper is a bit unfortunate imho, it sounds a bit like heresy - your altchain is designed to support fragmentation of Bitcoin ecosystem and you're asking Bitcoin foundation to support that? Maybe you want to tweak your wording a bit. There are far more productive use cases for cp2pt than just faciliating BTC x LTC x otherscamltc p2ptrade.
As I mentioned in the proposal I'm not looking to fund development, just community stuff at this stage. Once there's a community and some development then I'll consider asking for development funding. The whitepaper is very much a work in progress. I'm quitting one of my jobs at the end of June so I can work on Marketcoin part time.
Unfortunately the only use ATM is trading to Litecoin or shitecoin, but I don't see these altcoins being particularly useful. Ultimately I'm looking to create infrastructure that will help exchange between Bitcoin and purposeful currencies, be they local currencies or for novel purposes (like Namecoin).
Also, I don't expect this grant to be successful. Worst case is the board reads it and says no; I'll be working on it either way, though it might be a little slower without a grant. I'll be applying for another in 3 months in any case. At least they hear about it and there'll be some discussion.
I believe that Marketcoin will not fragment the Bitcoin ecosystem; rather it will help it flourish. The philosophy behind Bitcoin is present in Marketcoin, and will continue to be.
Edit: Grant Proposal submitted. View it here:
https://github.com/XertroV/MarketcoinWhitepaper/blob/master/GrantProposal-Q2-2013.md