I would just go with regular tcp sockets. The only thing that is missing is 'ifconfig lo up'. When I get some time I'll figure out the necessary ioctls, or borrow them from busybox or some other minimally sized app. Once the loopback device is up, it is just a matter of binding to 127.0.0.1 port foo, and accepting incoming client connections.

We know that the empeg has a full network stack already, otherwise tcp over the ethernet cable wouldn't work.