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Is there ongoing work in this area?
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AFAIK, no one is working on either traffic obfuscation or smarter clients. Most Nostr devs are focused on building social media apps -- a focus which is slowly killing the future viability of Nostr.
I would write the code myself, but I'm far too slow at programming; I can't make meaningful progress in my free time. Plenty of ideas, but no ability to implement them. The years I wasted not getting good at programming have finally come home to roost.
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The ability to penitrate network blockade is very important for Nostr. Otherwise, it can only be a transition protocol. Hope you can write up an explanation to inspire more people do the work.
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There are two changes which together can solve this problem:
These two changes together would make Nostr nigh uncensorable.
The second change is the most important and it is rather complicated. At the moment, I don't have the time or energy to explain it. But if someone shows interest, I could set aside some time to write up an explanation.