Here is where I think I am going with this project.
The light brown is the structure of the overall box. The green, will be a piece of poured sugar. I want it to feel like you are looking through the river at a water horse in transformation. The wavy green line will be another part of the armature structure. This piece of wood will allow me to build a below the surface and an above the surface view. There will be a dowel that goes from the bottom of the structure, through the water horse, which will allow me to better join the two halves.
The most complicated part of this structure is going to be the armature.