Hm, that'd be cool! But might look weird, and might not be very useful unless you have all items in chameleon.
I'd prefer if chameleon works as before, just that it's much much much more rare to find constant effect items of it. It should possible to get 100%, but you should look in every nook and cranny of the world - in my opinion.
This brings up another question, although not related to this thread:
How did you feel of the massive amounts of constant effect items in Oblivion? It was incredibly more common in Oblivion with constant effect enchantments of armour pieces than it was in Morrowind. What road should Skyrim take do you think? Rarity of contant effect items like in Morrowind or the commonness of constant effect items like in Oblivion? Maybe I should start a thread of this...
I think this was due to the Oblivion style enchanting, wich took out the customisation options completely.
An enchantment on armour was always constant effect on self, on a weapon it was always cast on strike.
I would hope that now enchanting is a full fledged skill we will get the customisation options back.
This would also allow more varied types of loot, and preferably constant effect enchantments should be rare to find and expensive and hard to make.