Did anyone ever build an engine with the rings

Also keep in mind that the forces on the piston are NOT simply up and down. As the crank rotates, the piston is pulled from side to side. On the power stroke, it's basically being slammed against one wall. In your design, the point of friction moves up and down the length of the piston, which changes the angle that the force is being applied. This would seem to cause all sorts of strange wear issues on the inside of the fixed-position ring. When the ring moves with the piston, the force is always applied squarely to the ring sealing surface.

But really, it boils down to -- what is easier to do: rebore a cylinder, or rebore a cylinder PLUS recut 3 internal ring grooves to a precise depth? That alone would make it impractical.