Is there any opinion that allows women in niddah to dance holding the sefer Torah on Simkhat Torah?
Any impure person, even [a woman in] a niddah state or a gentile, may hold a Torah scroll and read it.
SA YD 282:9 rules the same
PS. I assume you are not speaking of mixed dancing which will have its own set of prohibitions.
Q: Chacham Ovadia Mayaan Omer 3: pg.202 was asked a question coming from outside Eretz Yisroel. The question was can women dance with the sefer Torah?
A: Chacham Ovadia answered that they should not do so. They then proceeded to ask does the halacha change if they dance with sifrei nach on klaf, or if the women dance by themselves privately? Chacham Ovadia answered it’s not proper, but added if the men would not see the women at all then it is possible, but the look on his face showed he wasn’t happy with the idea.
In the footnotes ,it's explained that this was not a halachic consideration ,since it is permitted for a woman to hold a Torah even while being a niddah, but is more of a hashkafic reason as mentioned in the footnotes ,that this was never the custom and seems to be coming from not pure motivations (equality).