Tonight I got the phototransistor hooked up and printing out values. I used the matched emitter and sensor from Radio Shack for this. The infrared LED is extraordinarily bright from the testing I've done and is isolated to a very small wavelength, awesome. Though the phototransistor that comes with it is basically as sensitive to visible light as it is infrared, or at least that what it seems like which is not very cool. On my desk is a small lamp with a CFL that registers between 900-1000 which produces relatively little infrared light. Using the infrared LED at zero range registers slightly above 1000. I've got some old infrared gels laying around that might be able to reduce the phototransistor sensitivity of visible light to reduce the chance of unintentional triggers.
Next step now is to try it with some simple tests to see how consistent the results are. If the results from the initial tests are good that pretty much leaves setting it up in an enclosure and finishing the software. The keypad interface code seems like the most complicated part from messing around but I'm thinking a huge case switch with a mode for each button. Depending on the mode of the system each button will be context sensitive. Any thoughts or methods for keypads and interfacing that might be better than a huge case swtich would be greatly appreciated! Sorry no pictures tonight. Cheers!