What is the state right now regarding free form deformation, or deformation of any kind? I have the Pro version.
Free form deformation at the moment is available as an experimental preview feature only for pro users only. It's in a proof of concept/experimental state, and we don't recommend using it in your real game yet, as it will be greatly expanded/enhanced/evolved before it's finished, and for the time being it's unsupported. If you start working on game assets, and encounter a deal breaking bug with your deformation Spriter project, it's going to take a back seat until after 1.0. With that in mind, if you just want to play around with it, and test the features, the following video at 6:23 has a basic rundown :
We are working on finishing the current build of Spriter, which is has the bulk of the remaining features until 1.0. After this version it's just bug fixes, and useability enhancements until 1.0.
After 1.0 and catching up the documentation, we'll be focusing on deformation and other (unannounced) post 1.0 features(free updates for current owners of course).
Most of the functionality is already in there, such as dynamic tessellation, skinning around bones, and variable levels of curve detail - also, deep control over texture coordinates and mapping. The rest of what needs to be done, is making things more flexible in how you can divide and control the skin, and enhancing the workflow from start to finish so it's quick and intuitive.
I've tested the basics (simple drawing deformation tests, not real world/stress tests) with the C2 plugin sdk, and after a small request (already filled) by Ashley, it's seems the c2 plugin should be able to support deformation as well.
So basically, we have quite a few things to do before we get there, but it's the one of the next steps after Spriter 1.0, it will be very powerful and easy to use, and it will work in c2 - but it's much to early to give an ETA.