I played with an early prototype of delightfully engrossing Meggy Jr at Maker Faire Austin in October. It's an open-source kit to build your own pixel-based video games. It's made by my friends at Evil Mad Scientist Laboratories: Windell, Lenore, and Chris.
Meggy Jr RGB is a new kit that we designed as a platform to develop handheld pixel games. It's based around a fully addressable 8x8 RGB LED matrix display, and features six big fat buttons for comfy game play. The kit is driven by an ATmega168 microcontroller, and you can write your own games or otherwise control it through the Arduino development environment. Meggy Jr is fast, programmable, open source and hackable. And fun.Kit prices range from $65 to $95. Meggy Jr RGB