in reply to networking over the loopback
tcpdump -i lo -w /tmp/loopback.log
This will log all packets on lo to the file /tmp/loopback.log. You can then read/analyze them with:
tcpdump -r /tmp/loopback.log 'filter stuff here'
I thought about this a little more this morning, and if you have the extra resources, and know a little about writing rules, you should be able to use an IDS (intrusion detection system) -- like Snort -- to monitor for/alert on specific events. Now that I think about it, an IDS could be a really good debugging tool for a project like you describe. (And, if you get to the point where you are testing on multiple system on a LAN, your IDS will still be able to help as long as it is located on the same segment.)