I still don't know about the PS2 keyboard and LCD on the Tiny85, but I'm just wish-hoping it will fit and work. Since nothing else will run on the thing it should be good to go. Them this board can be larger while the actual target will be very very small so it could fit on top of a mini-car or something like this:
http://elm-chan.org/works/ltc/report.html
And please, no, I can't teach C and use the Arduino IDE, as those kids can't afford computers and I can't afford to buy computers for the class, as this is mostly a hobby/charity thing for now.