A WAgame demuxer for ffmpeg is possible, but has licensing issues because the WA engine is closed-source.
Hypothetically, if the WA engine was open-source, a WAgame demuxer could be written for ffmpeg that simply serves the video and audio from the WA engine optionally built into ffmpeg, in a similar manner to how Themaister, author of ssnes/libsnes/retroarch/libretro, implemented a bsv demuxer for ffmpeg (
https://gist.github.com/Themaister/1154721 ) which played Super Nintendo input recordings using ffmpeg.
This would allow video players that use ffmpeg for decoding video (such as MPC-HC via LAV Filters) to play replays without encoding a video first.
WA can't save and load its state, though, so keyframe seeking would be slower for the longer into the game the seek point is, as the engine would have to run to that point. WA state is pretty large, so implementing state-saving and therefore keyframes for seeking in a long replay would not be trivial, I think. Anyway, that's beside the point. Seeking would be possible, but just slow.
Team17 is unlikely to open-source WA, but I still have hope for that eventuality.