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The bevel could be virtual - painted on by the OS or application but not accepting touch inputs. Perhaps even custom to the user preferences. It could go away for certain uses cases, like full screen video. It could even have function buttons rendered on it that are context dependent.

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Sure, this might work. But the extra pixels needed for the bezel will consume battery with current technology. Also, a new kind of proximity sensor have to be developed for these use cases. It will be really annoying to set the virtual bezel manually all the time.

Not on AMOLED. Remember that AMOLED does not use any power to display blacks.

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