custom objects walking around are just bigger files that have a lot of frames that stretch over the whole area which is walked. there should be another somewhwat recent thread findable with [search] on that topic. also, SiamJai made a post a bit ago about a nightsky car CO animation, there you'll see the concept.
custom objects are also completely inactive, that means they are nonsolid and cannot (directly) have any effect on the player. you could try putting a kill tile, but that's stationary etc, so probably not really what you want.