Question about KML/KMZ

I saw an interesting post for an uninteresting game, and it got me to do some snooping and searching. And now I'm here :D

If anyone is familiar with Google Earth, this topic would be specifically for you. Our game is set in a post modern future of earth. What I would like to do, is create custom maps in kmd format to have them viewable in Google Earth. These maps would display locations in the game, images on mouseover (such as the 3d models for the buildings, etc) And also interesting statistics, like crime rate or major events, monuments, etc.

Now comes my question. Can the custom overlays be placed on top of pre-existing information? In the example that I saw, the creator had created their own game island in the middle of the ocean. Also, Disney did the same thing, creating the Islands from "Dead Man's Chest". What I would like to do (for starters) is to create an overlay on top of New York City, effectively ignoring all of the previous information stored in NY.

I think this would be a great tool for online games (especially modern and post modern ones... or even historical ones). Also, as expansions to our game are created, they will involve other cities, which could then be created with the expansion.

Just imagine, assuming the custom map was well-developed, you could get directions from one game location to another, or even from your own house to a fictional game location (which might be fun in itself, just to see what's really there). The possibilities with this tool are endless.

So, if anyone knows if this would be possible, could you let me know? Also, if anyone is experienced in XML and would be interested in helping us out with this, that'd be great too.

Thanks in advance!