So, anyone have the balls to replace the PN544 with a PN65N?

From what I've read, Secure Element support is on the SmartMX, an additional module inside the PN65N.

If you were to pursue a pure-software approach to this, I think it would be best to check out how a real Galaxy Nexus does the authentication, card emulation and transaction at the NFC stack.

Once that's done, you can start stubbing SE functions and add them to a modified pn544 driver.