ideasman42, thanks for the reply. That explains a lot, and in fact that was the main problem I had with the blend shape system before deciding to take a look at into the shapekey deformer. I do not want the shapekey deformer to be applied first. Since the blend shapes are applied first it makes it hard to combine morphing with other modifiers. So I am thinking that I either try to write a modifier, or create an option for the current modifier (after your reply).
In that system obivously one either has to use the shapekeys or use the new modifier. What is your take on a shapekey modifier that relies on the stack order? Is that something that can go well with the state of the mesh in Blender?