At present I don't know of anyone working on a C64 compiler or engine so feel free to make a start. The best place would be with the compiler and engine for an existing 6502 machine; Kees van Oss did the initial Z80->6502 conversion work so he's the best person to talk to about that. You'd also need to tell me about the graphics format you want so I could update the Windows editor and output data in the correct manner for the compiler/engine to use.