If your limbs are fairly straight, you might have some luck with a veneer lathe.

That would be too labor-intensive given the large number of small trees that would be "harvested" for this purpose (100/day?).  I'm looking for a process that is automated and low-cost.  Thanks for the response though.

I need a little more clarification, do you need a machine that can handle the smaller limbs or is the size of the removed bark the problem? (or both?) Are you only interested with part of the bark? Can you tolerate any "contamination" with wood pulp?

I do not know of anything suitable for your usage, but I imagine something could be made. I would start with a set of pinch rollers feeding the limb into the de-barking stage. Two de-barking stategies that I can think of off the top of my head include a wide chain (multiple rows of roller chain) or steel wheels with bits.

One more idea - you could use high pressure water jets if there is enough difference between the bark and pulp.

Thanks for the high pressure water jet idea <jbthiel>.  That sounds like it may hold some potential.  I think if the shrub were soaked to sufficiently loosen the bark, the high water pressure may be able to remove it.

I need a machine that can handle small limbs/trunk.  Size of bark is not a problem, larger strips are preferred.  Minor contamination with wood is tolerable.

I have not been able to find a conventional machine that would be applicable for a shrub with such a small diameter (1" - 3"), so a custom-designed apparatus may be the only mechanical solution.  Do you have any knowledge about where to start along that path?

Try the Publisher of Forest Products Equipment.  (Jim Kendrick) Website is www.fpemagazine.com

Fence posts are commonly this small, so the system must already exist to render the small diameter debarking necessary.

Couldn’t you just feed the whole tree and everything through a chipper and sort it out latter via some sort of settling, filtering methods and decanting?

onereggie,
There exists a tool for cutting kernels of sweet corn from the cob.  It is similar to a wood plane used for cutting radiused moldings.  The corn cutter cuts a lengthwise strip from the cob and the cob is rotated to make another pass.  For your application,you could arrange several around the diameter and allow them to float to compensate for the taper.
Gotta run but google ammerican corn cutter & molding planes
to get a general idea of the concept.

Griffy

onereggie,
Another similar cutting device is a potato peeler although the cutting edge is usually straight on these.

Griffy