I'm interested in this targeting idea, I have a GREAT example of a game that effectivly used a targeting system for sword fighting. Legend of Zelda: The Orcania of Time.
you could press a button and lock on to a target, easily straff in circles around it merely by pressing left or right (and you didn't straff excessivly fast either), and pressing the lock on button again would disengage the lock.
You also had the option to only be locked on while holding down the button, and it would dissengage whenever you let go. (although I'm not so sure that second option would work as well with a mouse and keyeboard)
That game didn't have enough sword fights, but when you did it worked quite well. there was a block button you held down to block, and you couldn't attack while blocking.
I think any kind of a system other than auto blocking would be nice for saber battles in JK. It'll add SOME degree of skill to things. The battles in JK were a lot of straffing around to hit a person in a spot where he couldn't auto block, I hated that. There was also a lot of running around and randomly double swinging. hardly worthy of such an elegant and precise weapon as a lightsaber.