I've got a display returning states from 1 wire temperature sensors ...
or is there a better way to achieve this, microVGA for instance?
... possibly move up to a Mega for more I\O later, if that helps.
How much information is returning from each sensor? In other words, do you need to dedicate an entire display line to each sensor?
Have you considered using a Graphical LCD?
Will this interest you at all?