Do you think it would even be possible for us too make this game? I could get startedf with making some environments in blender. I could probably do some cities.

Hmm.... Perhaps. It doesn't seem that complicated - using Unity or UDK would make things easier. I might even have an interested programmer or try and grasp it myself. As long as you are willing to make the game I could devote myself to expanding the concept with some solid descriptions, plot and mechanics.

As a beginning making characters and exploring the possibilites of free travel would be important, so preferably simple stick chars with moveable joints that could be implemented in UDK or Unity would be cool

I have some basic knowledge in blender but that is currently it. I could probably get some liscence free models from online just to get something to work with. However I don't have programming knowledge to try to make this, we would have to get some other more experienced people to help.