The purpose of arrays in C, when pointers could have done the job

There are no guidelines or any practical limits on indirection. There's no good reason to place a constraint like this unless you're regularly dealing with several levels of indirection in a case indicative of a sloppy design.

That is to say that there are valid cases where 4, 5, 6, or more levels of indirection is to be expected, but these are rare and should not typically appear in your code unless someone has done something terrible, not directly related to the level of indirection being employed.

If you are finding yourself using, say, 3 or more levels of indirection, then you should probably consider whether your architecture needs to be changed.

But does that mean you should never allow more than 3 levels of indirection? Absolutely not. It simply means that it might potentially be an indication that there could possibly be an inherent inefficiency in the architecture of your code. Nothing more. (Do note the deliberate vagueness of that statement: it is a mere possibility of something that could lead to a problem, not necessarily an actual problem.)

You will probably make it a lot easier on yourself and avoid a lot of user errors if you allow the declaration of variable-length arrays to be delayed until a point where the size is known. Then you don't have to invent a syntax for assigning the array size and you don't have to deal with differences in the order in which arrays are declared and in which they get their size.

If your compiler uses a stack-based allocation scheme for local variables (they are given addresses relative to the stack-frame of their function, like it is done for the 'big' platforms), the variable-length arrays can just be carved out of the stack frame as needed. Only if there are multiple variable-length arrays in a function do you need an additional pointer to indicate where the data of each starts.

If your compiler uses a fixed allocation scheme (all variables, including locals, are given a fixed (absolute) address by the compiler/linker), I would use an 'array stack' for carving the variable-length arrays from. As overhead, you would need a global pointer to indicate where the free space currently starts, a pointer for each variable-length array to indicate where its data is located and, in each function using variable-length arrays, a way to restore the global pointer to the value it had when entering the function.
The user would also need some way to indicate to the compiler/linker how much of a 'array stack' he thinks will be needed. A reasonable default could be to use whatever is left after allocating all fixed-size variables and variable-length array overhead.

I think this scheme uses the least amount of overhead, both space and time-wise. The scheme you came up with is essentially a malloc implementation.