Electronic – Alternatives to a classic DIP switch

Because your board will be used by internal engineers and infrequently changed, I suggest a solder-based or track-cutting solution.

A pair of pads on your PCB make a fine switch, and there's nothing that could be cheaper. Touch it with your soldering iron and some solder, and you've made a connection. Touch it with the iron and some braid and you've disconnected it.

If you want it to default to 'on' and you're using stencil + reflow soldering, just add some paste over the whole area and it will short during reflow.

Sparkfun's library has a few examples, they look like this:

They can be quite small; an 0402 resistor footprint works fine for this purpose and takes up far less space on your PCB than a DIP switch.

You are right, you need something more than a simple single pole single throw switch to make a digital logic signal. Usually that something is a pullup resistor. The resistor goes between the power supply and the logic line, and the switch between ground and the logic line. When the switch is closed, it hard-shorts the line to ground. When the switch is open, the pullup resistor provides a weaker drive to power.

The tradeoff is that you want the pullup stiff enough (low enough resistance) so that it can overcome any current that other parts on the digital line might be leaking to ground. It has to be weak enough (high enough value), so that the current is limited to a reasonable value when the switch is closed.

Most CMOS logic gate inputs leak little enough that a few 100 kΩ to power is enough to guarantee the voltage will be interpreted as a logic high level. However, you don't want the line to pick up stray noise and of course you want some margin. If in doubt, use a 10 kΩ pullup.

This same concept works flipped around too. You can use a pulldown resistor and put the switch between power and the logic line. For various reasons, switches, whether mechanical or transistors, are usually connected to ground, and therefore pullups are more common than pulldowns.