To get more torque out of something this small, we need a higher reduction ratio.Yes.
The Fazua, as I read it, puts out 1.9N at its output shaft, and that motor is much longer than a 135 mm dropout on a typical bike. It multiplies that with a gear that turns the pedal axles, with further increases thru the derailleur.
Your concept drawing show a motor not much wider in diameter than a hub, around the size of a Fazua. Give it it a 1 nm output for being half as long. I'm no mechanical engineer, but seems to me it's going to need some innovative gear design to even get 5X multiplication.
We're trying out different ideas and building a demo to test it out and see how it feel.