I got a little 10k LDR and a bottle cap. Cut the bottlecap so it was thin enough to fit under my guitar strings. Drilled a hole in it, put the LDR under it, hooked it up to my headphone amp. I positioned the pickup under my string so that the shadow of the string was right on top of the hole (i'm using sunlight at this point).
The sound was absolutely phenomenal, sustain is extremely long, there is no noise whatsoever.
Now that I know it works, I'm gonna design a proper prototype (covered to avoid light pollution, LEDs instead of sunlight).
However, I need some advice. Where should I position this pickup on my guitar? It is going to be covered, don't forget, so it will eliminate a portion of the strings. If its at the bridge, you won't be able to palm mute, at least not very well.