I might play with this on my own, but I had the idea yesterday that it should be possible to recreate a block cursor using unicode block characters.
I think it should be a pretty simple plugin; just save the current character under the cursor then replace it with a box drawing character. Granted, that character is no longer visible...
You'll want to keep a running x-y coordinate of the cursor (I think Sublime just treats this as a one-directional offset from the beginning of the view), since things like CTRL+HOME make restoring the original character a bit trickier. Also, I'm not sure if it's possible to edit a view without adding to the undo/redo stack.