I just read this (post #21) and figured I'd pontificate on what I've been able to do fairly quickly. Lightwave makes this easy with the built-in tools available. Now I have to be honest here: I don't remember if I read this technique in someone else's tutorial, or if I thought of it on my own.

Once upon a time I downloaded a model of the Imperial Probe Droid from Star Wars Episode 5. The model I downloaded, however, was for another package, and had been built pretty sloppily. I ended up completely rebuilding it (nothing original though: I used the downloaded model as my template, so mine looks pretty much exactly like the original). One of the deficiencies of the download was there was nothing to animate. I wanted the spider legs to fold and unfold. Here's a short flik of my rebuilt, fully rigged model.

To do this most easily requires a bit of planning in Modeler. You need to build each animatable part in its own layer, and with the rotation point at 0,0,0 and with the body facing along the positive Z axis. For example, here are all the parts for one leg:

The next step is to place in Layout each part in its proper relative position:

Also, set up a proper parenting hierarchy:

Now, the really easy part: Bring up the Motion Options panel for the Piston, and have it point at the Cylinder, and vice-versa:

Suddenly, the two are now properly engaged, and as you rotate the lower arm, the whole piston assembly Just Works:

The next step is to assign reasonable rotation limits for each part of the arm. You don't need to worry about the piston assembly at all since it's now fully automated. Finally, add an IK target for the arm, and turn on IK on the end piece, and each piece up the chain (be sure to not enable "Keep Goal Within Reach"):

Now you can just animate the goal object and the whole leg does its thing.