I think logistically it will be easier to start with one person and build it slowly. That means the first time around the first few people won't see many prints, but they'll get to see the whole round when it comes back to them.
If we were to try to have a complete portfolio from the beginning, that adds the complication of everyone having to send in a print by a certain deadline, and if one or two people were too slow, it would delay the whole process, and then the originator would have to worry about returning all the prints at the end and assembling all the new ones.
With the revolving portfolio system, where you just add a print when it comes around and remove your old one, you avoid all the problems of collecting and returning.
As to the idea of incorporating a permanent exchange with the revolving portfolio, I like the idea in theory, but there is the issue that we might have participants of widely varying levels--some of whom may be amateurs interested in critique and some of whom may be working artists who can normally sell their prints for high prices through galleries--and this may create some awkwardness that could discourage participation. Perhaps it would be best to organize this sort of exchange in parallel, privately or through a discussion forum.