I have built a polargraph, which uses this very mechanism to move a pen holder around on a vertical drawing surface (check it out - it's extremely cool) http://www.polargraph.co.uk/.

Handily, there is an openscad design for a parametric ball pulley, specificallly designed for use with stepper motors, on thingiverse here: http://www.thingiverse.com/thing:12403

My experience using these is that accuracy suffers as the engineering tolerances on the ball chain are not that great. YMMV, but it's worth giving it a go.