The 1 v1 race idea is cool. The only problem i see with this is that people would disrupt the two racers and if one won the other would moan. Also, if this was for money then 2 people could make a deal. One races for 2mil the other stop the guy he is racing against. then they split the winnings. So maybe 1 v 1 races for fun, but not for cash.
Dueling for cash has been discuseed before. However, i can not remember if we thought about the duelers betting aginst each other (idea was then to allow others to bet).
Hmmmmm.....i can not think of a disadvantage at the moment for allowing people to bet agsint one another. As long as other people could not bet aswell and money came from bank account it should be possible.