A bit of an update on the slow progress of my version of "Life Clock" (I could not resist :-[):
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I switched to atmega 328, $2 more expensive, but lots of memory for future expansions;
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I was able to store my character set definition (8 bytes per character x 96 characters) in the local eprom (1K now); so now the 24LC256 eprom has only messages (32K, aprox 16 book pages);
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implemented "sleep mode", through remote control; in sleep mode, the whole thing is taking now 3.5 mA (an off-the-shelf arduino takes at least 15 mA in sleep mode). For this purpose, I had to build a custom arduino board, basically a protoshield (the small/short version) with only the processor on it. I eliminated the power LED (20 mA wasted right there), the FTDI chip, and the voltage regulator and the reset button (I always use a shield that has a reset button).
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I am still waiting for the LED matrix shields from seeedstudio; they should be available for everyone soon;
I think there would be a need for yet another arduino-compatible board, one similar to Arduino Pro from sparkfun, but with an atmega 328 on it and no LEDs, plus some other provisions for sleep mode.