I can't say I did this on my Atari8, but I can truthfully say I did it with my Atari8.
This video was recorded using the Kaleid-a-vision hardware, Atari8 and video camera. I would suppose any retro computer or video game machine could be used as a video source.
The Atari was running a GR9 Demo program. The one with the rotating coins and then vertical color bars bouncing from the top to the bottom of the screen. The music is from some music I built using a Garage Band demo version on an old iMac (many years ago). The visuals were recorded and then the music was added.
This next video was recorded as a trial run. Near the end, the camera is moved to reveal the setup.
Now the question remains what kind of cool could be achieved if programs were written specifically to move pixels around the screen. Color cycling, pixel bouncing, and icon rotations are the first to come to mind.
Start with a kaleidoscope. A build-your-own may be the best option. I got the Nature Kaleidoscope Kit by Gemini Kaleidoscopes! From you know who. It has a cup to put into the end to hold stuff. Leave the cup off and its clear viewing.
I used LEGOs to build the stand and a power factor motor to provide the rotation. The speed is slightly adjustable by changing rubber bands on the pulleys. There is much to be done to improve on this original design. I offer this set of LEGO build instructions as a starting point. It's in HTML format. I couldn't view it using Microsoft Edge but Internet Explorer worked find. The .lxf (LEGO Digital Design) file is also included.
Building Instructions Kaleida-images.zip