I voted for not that great for the business model aspect only.
I actually love the idea of creating an "only available online" RPG system, and would help you with it playtesting etc I think it could be viable as a model.
But I think you need to use a more 21st century business model than your thinking. If you really want to make money at this and your gaming system is really good. What you need to do is digitally publish your "core" Rulebook(s) for FREE.
I know free doesn't SEEM like a good way to make money but your NUMBER ONE goal should be to create a community of users, a core group of people who use and love your product.
Establish a site, create forums, distribute the core information for free
Once the user base is there, Once you've established a base, then supplemental material is where you should aim to make your money. That is when you start getting Paypal involved and gear up to do digital sales. Heck you might even be able to attract outside investors to start publishing hardcopy books once you can demonstrate a user base.
I could give you tons of examples of how well this model works, especially online, but Facebook is probably the best. Of course, your not aiming for the same user-base that Facebook has, but if you really want it to be a success, free is the way to go for this kind of start-up...