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The buttons *need* to be fairly large so that you can hit them with a fingertip or stylus (both of which are less precise than a mouse, mostly because you can't separate moving from clicking/dragging).
A good solution would be to put physical buttons above or below the screen and a separate LCD character display above the main screen. These features would give you roughly the same vertical real-estate as a much more expensive larger screen, with a cost of maybe another US$20.
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