Let's take a page from Steve Jobs' playbook.

Get rid of the hinge. This also gets rid of the latch and reduces manufacturing costs. Get rid of most of the buttons. This way, you don't have to pay for the displays on most of them. Keep the buttons with the dynamic displays, but have fewer of them along the side. Add some "trigger" buttons on non-visible surfaces and two D-pads. Software keyboards are good enough for in-game use. Multi-use buttons with displays have the same problems as a software keyboard anyhow. (The space is not available for the other controls when you are using the qwerty keyboard.)