First thing is to split vertices, that would most likely take care of the bulges. I'm not sure if a skeleton or morphs would work best here, ideally a skeleton, but there are some issues with the membranes in that case. If you have Bloodsong's book she has written something similar (about how to make webbed fingers) but I didn't quite understand it LOL

Woah dude.... That's some heavy sh*t... |OP Thanks for the push in the split verices direction. In order to maintain the smoothness of the "Bones" I'll have to import the membrane as a sperate piece then re export them as a single object. A split vertice is essentilly that right? Each poly becomes it's own individual unitbut keeps the same mappiing values?

But split verts cannot be 'smoothed' and retain a faceted look.

I think some of the promblem is that the model is triangulated and Poser prefers quads. I hope you get it solved, it looks really neat :o)