You could use the Tiled Background object with a power of two texture. Then just draw each frame in that texture like a sprite sheet. Then using a list of all the offsets and height/widths of each frame you could do arbitrary length animations.
Here's a proof of concept using Ken from Street Fighter 2:
http://dl.dropbox.com/u/5426011/examples3/ken.cap made in 0.99.96
This is where I got the sprite sheet:
and I used Sprite Vortex to assist the creation of the animations:
I didn't want to use the xml format spritevortex exported so I converted the data to simple lines of text.