For such a device to be complete, it should be able to generate offline transactions as well. But that would probably require a way to scan QR-codes. Manually inputing addresses is error prone and annoying.
Anyway, this increases the complexity of what you're trying to do...
Anyway, this increases the complexity of what you're trying to do...
All true. I would love for the device to generate transactions, too, but like you said, manual input of addresses is problematic and adding a camera or the like increases the complexity beyond what I had in mind. But I'll keep brainstorming. Manual input, annoying as it is, wouldn't add too much complexity if the device already had a keyboard and screen (like casascius's POS terminals). Hmm...casascius, do your POS terms support a barcode scanner? Maybe the printer could output an old fashioned barcode instead of/in addition to a QR code...?
The barcode is a good idea. Two people both using this device could safely send money to one another.
Concerning the keyboard, it doesn't need to be embedded. You may have just an USB port to connect a keyboard to. Such port could be used both to input the encryption password and to write out the encrypted wallet seed into a memory stick.
Such port could also be used to connect to some external software that would provide transactions to be signed. That would still be vulnerable to the risks described here, which can be considerably mitigated by what jim said just after.
Actually, if you manage to make the printer "detachable", or make it capable of connecting to an USB-printer instead of having its own, than your device may be really small. By that I mean "portable". Improve it with p2p wireless communication like that bitcoincard thing, and hidden volumes for plausible deniability, and you've got the best bitcoin storage and payment device.
