Project
The system is effectively a sensor network that connects to a star topology routing network. The Identities of each node's identity must be kept secret from all listeners as the range of the RF transmission and relay may be on the order of tens of miles. Each sensor node has its own Identification number, as required by laws pertaining to our systems target deployment.
This means that if someone is able to read the identifier on the node then the security has not value, so a side channel attack on our implementation is a waste of time, unless they can implement it from a long distance, but I do not believe our SPI will radiate that well when sandwiched between a power and ground layer.
Security Options
This question is asking for solutions to using AES-128. I will explain what I found in an answer that I was lead to directly by Joby Taffey. Thank you Joby. I was looking for off-chip low cost solutions that could speed up our system greatly, it ends up i missed something from my chip supplier.
Best Answer
Having a separate encryption co-processor could be risky. Anyone with a Bus Pirate or logic analyser and physical access can sniff the bus and pluck out the plaintext data.
You can mitigate the risk a bit with BGAs and/or epoxy, but the best solution is likely to be a SoC which combines MCU with AES.
One approach might be to use a SoC ZigBee chip and ignore the radio part, eg. CC2430, or EM250.
Or, you could go with a Stellaris Cortex-M3 (some have AES tables in ROM)
Or, do it in software. I've used Brian Gladman's code before in projects.