Hi Art,
Look up Charlieplexing, I think that's really what you're suggesting. With that and 16 I/Os you can drive 255 LEDs.

In your second example, when the pin is tristated wouldn't current be flowing thru both diodes, turning them both on? Obviosuly depending on Vf of the particular diodes but never the less.

Instead, connect the LEDs in reverse polarity between the I/O-pin and a voltage divider across the rail. Now when the pin is LOW one of the LEDs will be on, when it's high the other LED will be on, when the pin is tristaded neither LED will be on.

/Henrik.