Dan,
Upon reading up on the Velo Dog yesterday I also came across the .221 Askins. That's even closer to what you are looking for then the Velo Dog, but considering it's based on the VD case it would be even more work/rare. The .221 Askins is the VD case cut down and the rim filed down to match the .22lr profile, but a CF cartridge...
All the work of obtaining and then modifying cases (not to mention the firearm) would undoubtedly negate any cost saving in making a CF .22lr...
But it is kind of neat.
http://www.bullseyepistol.com/askins.htm
