I reackon it can be easily done. Check this thread:

http://www.conitecserver.com/ubbthreads/showflat.php?Cat=&Number=498414&page=0&view=collapsed&sb=5&o=&fpart=1#498414

Use the same concept. You will just move the verticies in real time, based on the movement of the top verticies of the cape. Make sure you check out DooeyJo's post in that thread.