This is a really excellent question which requires us to tie together the solutions of the Ehrenfest paradox and the train tunnel paradox.
The Ehrenfest paradox says that a relativistically spinning wheel should be length contracted on the edge, but a radial line isn't length contracted (because it's moving perpendicular to its length). So what is the radius of the circle? Is it 2pi*r? Ehrenfest resolved his own paradox by (correctly) asserting that there can be no rigid rotating objects in special relativity. Einstein later pointed out that one could imagine a wheel in relativistic rotation, not accelerated to that point, but constructed already in rotation. Its surface, as viewed by an observer riding the wheel, can only be described using non-Euclidean geometry.
But I think these answers doesn't give a good intuition for the question "what happens to a wheel (or chain/gear system) as I try to increase its rotation rate until its edge is relativistic?". I think a model which might give a better intuition is to imagine a wheel of particles (say spherical shaped particles) joined by springs - and somehow I apply an external force, or there's supports, such that from my perspective (the experimenter making the wheel rotate) the radius of the wheel remains the same. So from my perspective the distance between the particles remains the same. But something suspicious happens to the particles - they are no longer spheres, and rather ovals - obviously they're squished because of length contraction. And although the springs haven't changed length from my perspective, they are under strain. To better understand what's happening, enter the perspective of a particle. From that perspective, the length between particles has increased, and the springs are most definitely stretched. I look down at the other side of the wheel, and I see something similar to what the experimenter saw - particles that are actually closer together than the original length, but the particles are squished in their direction of travel by a bigger factor than the reduction in length. And to some extent, I infer that I need to be farther from my neighbors because the particles on the other side of the wheel are all bunched up from length contraction.
I think there are important takeaways here:
(1) the volume of a certain region of space does not need to be identical to different observers. From my perspective the length of the outer edge of the wheel never changes: its 2pi r, but I can see from the narrowing of the particles that from their perspective it's more than 2pi r.
(2) Length contraction is usually thought of as the length of a relativistic spaceship being smaller from my perspective. But if I somehow enforce that the spaceship doesn't get smaller from my perspective, then from it's perspective, it is stretched. As long as the ratio of the length perceptions is the lorentz factor, we're in accord with relativity. You need to be careful about what length, and from whose perspective, is enforced to remain constant.
So indeed, your relativistic chain which cannot stretch at all will instantly break the second it starts turning. Anything that rotates experiences a relativistic strain as bonds between atoms (or whatever holds the thing together) are stretched because from their perspective the length is increasing. This is usually a very small stretch in real life situations. But if we ever want to start spinning things relativistically, we will need to insert segments that can stretch (or extra chain links to span the increased distances from the chain's perspective).
But the introduction of the chain adds a kind of simultaneity layer of complexity here. Let's say an experimenter has two points in space (the gears) that are 1m apart - call them A and B. And let's say the experimenter takes a 1m long stick (when at rest) and moves it relativistically over the top of the two points. Since the stick (chain) is shortened, the back of the stick moves over point A before the front moves over point B (the chain is not long enough to span the two gears). But from the perspective of someone riding the stick, it is long enough, and the front of the stick passes over point B at the same time as the back passes over point A. But This is essentially the train tunnel paradox. The resolution of that paradox is that two events that are considered simultaneous in one perspective don't need to be simultaneous in another perspective. So when you ask your three observers "which chain link has just hit the top left gear/just left the top right gear," or equivalently "how many chain links are on top of the gears and how many are on the bottom" the three observers will disagree.