John,
It looks like you can center the covariate on the overall mean and then scale by the standard deviation. If you're not sure if the two groups have the same covariate effect, it's better not to make a stronge assumption, and go with
Model:-1+Time:Group+Group:MyCov
> would it be better to set up two 3dLME analyses, one looking at each hypothesis
> (one analysis omitting group membership and one analysis omitting the covariate),
> or to set up a single analysis to try to estimate the effects of group membership
> and covariate value at the same time?
One analysis with the covariate effects should be good enough to ask all your questions.
Gang