Which is heavier, 100m of fiber, or a watch battery and Nano?
I dunno, they got some pretty big watch batteries out there. =P
I think some kind of radio communication would be the best way to go, even with a "large balloon" Cause theres no way you could lead any kind of signal wire up 500ft to a balloon unless you were going for something truly massive.
The newer xbees can reach over a mile range IIRC, and they're mad easy to use, though they are a bit power heavy if you were gonna run off a watch battery. Though, how big is this balloon gonna be.