uGen, the additive lathe technique for using a fiber loaded polymer is quite clever - I can see a lot of applications for piping and other pressure vessel work (like the Ultem airduct that Solid Concepts made: [www.solidconcepts.com])
I got to chat a little bit with Scott Crump of Stratasys the other day about materials and asked him about fiber reinforced polymers. Nozzle erosion is a minor issue (the big industrial machines have their nozzles replaced after every 3 spools of material anyhow), but the primary problem is just what people have hit on - your inter-layer adhesion (which is already the weak point with a homogenous material) is even more of an issue, as the fibers do not cross between layers.
So, here is what I propose - the previously deposited layer needs to be somehow deformed or re-melted in order for the fibers to cross-link the layers together. I think using the concept of friction stir welding (look it up on youtube for videos of the process) is applicable, so here's the sort of extrusion nozzle I have in mind