Back in the old days they used seperate entities for arms and legs and just rotated them to make animation.
Is there a program that allows you to edit sequences of 'multi entity' animation out there?
This would stop a lot of slowdown associated with deforming meshes
Just about any animation program should allow you to do this. It is the exact same thing you are doing with bones under the skinned meshes, just without the skin.
if you use loadanimmesh wont it create more of a perfomance hit?
3dsmax can do it. There's also a B3D exporter for the free Anim8or, maybe this one works with move/rotate/scale animations as well.
Yes, every single 3D program that supports keyframing and parenting can do this, which includes just about every 3D software out there that has any kind of support for animation at all.
Though I'm not sure how much of an increase in speed, if any, you would get from this, compared to a skin that is rigidly bound to bones (all points are weighted 100% to bones, no smooth binding).