No, you don't need another collision system. All you do is move the camera up and down slightly as you walk. Most FPS games have it, like counterstrike... And looks nice if you have it in time with a footstep sound.
I remember reading a tutorial along time ago, I did a quick search on google but couldn't find anything. Anyway this was Game_Creator's idea for a tide, but you could easyily adapt it for a BOB:
position camera 0,camera position y+(sin(timer())*[crest - trough])+[average wave height],0
crest being the highest point of the tide and trough being the lowest point...so the code would look something like...
Atleast someones is interested in my bob theory
, none of this sprite crap