1. Both players need to set the opposite player to be invisible. you can do this by doing /opt uke 0 or /opt tori 0
you can determine what command you need to do by your position on the right side of the screen where it lists the players in the server, if you are in position 1. then you would do /opt uke 0 and vice versa for position 2.

2. Turn off trails, flames and any other effects or make it so they will only be displayed at the end of the replay, this is because even when you have done /opt 0 you can still see the flames or trails as they move.

3. In order to call out Marco or Polo, all you need to do is type it in a /em or /emote, this will show text above your head. so once one person calls out Marco you would do /em Polo
.

4. Mod, I couldn't think of a really good mod to do this in I found boxshu_mushu_v3 to be the best choice so far.

Well... kill the other player.