I got in one of those Z Shorty mechanisms to tinker with, and I've been studying and dissecting it.
I do think it's feasible to use one to power my 13-ton and 18-ton Climax A kits, but I'll have to design and make a couple new frame pieces to do it. Most of the kit is adaptable as-is, right down to the truck sideframes, and no more difficult than a regular Kato mech to modify.
I've probably had about half a dozen inquiries if my Climax kits could be done in Nn3, I've always said 'no'.. as there was no way to really narrow up a Kato 11-105 truck to do it right.
The catch is, and this is a big one - while the basic chassis can be adapted (including lengthened) I haven't figured a way to put the gearheads in, so you're looking at a pager motor driving truly tiny wheels off a worm; i.e. no super-slow speed control per se. It would be more like the Kato stock drive, as slow as you can go is still faster than you might want, but it would certainly work. And it wouldn't be Z-scale expensive, either, no more than my regular kit.
So, I spend the summer doing custom builds and designs for new product, this is on my radar. I don't need a whole lot of responses to go ahead with the additional frame development, but I'd give it a shot. Comments requested please, or email me. The other thing I don't know is how available those mechanisms will be or where they come from, I contacted the company direct and got sent to a black hole of Japanese marketing, and found one on Ebay and got it that way. What's kept me going on the Kato 11-105's is they've been available for ELEVEN YEARS now.
The majority of 13-tons and a high portion of 18-tonners were 3' gauge anyway, so this is a natural, and for all those folks in N that have always wanted a backwoods logging operation and tinker with some Z without breaking the bank, this might be fun. Even my Hickory Valley prototype had a 3' gauge coming into West Hickory for a while.