I'm curious how you intended to keep the sea horses in the refugium, where they won't be pulled into the bubble trap and eventually into the pump? Would you be relying on their ability to hold on tight with their tails?
And I'm just wondering outloud, but would the sea horses be able to handle the reef water.... since it is 'dirtier' for soft corals, and 'cleaner' for hard ones?
If you can put your refugium next to your tank, it should be displayable. I have mine below my tank, and I think it looks pretty good.
http://www.sparklingfloorservice.com/sump.html