The arrow disappearing on the bow is not the work of LOD or moving the arrow really far away, it's actually done using Visibility Channels.

You can use the Visibility Channel panel on the right hand side to define which frames of animation the group is invisible for. Remember, the bit you want to disappear must be in it's own group!
Screenshots that it worked, or it never happend.
I already tried this. The only best method I discovered is mounting an image.
The image is separate model, with colorshifting off. You have to mount the image during onAdd.
The separate model must have transparent texture in order for this to work.
The groups in the transparent model must have an LOD of -1 in order to work for Blockland.
The scripting side is what you have to figure out, its too easy to be learned by yourself, I do not need to explain on this further.
EDIT: What you have explained is the transparency that will not work. They are visibility channels. As far as I know, they only hide/unhide shapes, not make them transparent. (This only applies to Blockland, I have yet to discover by testing alot of different cases)