Electronic – How to make it so that customers who buy the arm based product can easily update the firmware

ARM microcontroller development is a little more complex. But, only really because DIP packages are generally not available.

If you're willing to use a development board, ARM development can be even easier.

The mbed is an ARM microcontroller on a breadboardable DIP shaped board.

The C/C++ compiler is web based and the board appears as a USB mass storage device. You download code by saving from your browser to the mbed. Even easier than a basic AVR setup.

Once you outgrow this setup, you can run gcc locally on your PC and still upload via USB. After that, you can move to JTAG using OpenOCD.

To stay within USB requirements you are allowed to use 500mA @ 5V power. This is certainly enough for the microcontroller but the display may probably need more.

Usually the Cortex-M devices feature a little internal (embedded) flash which is usually in the size of 2MB. If you need more memory, you could attache either an SD-Card or some NAND Flash.

I'll just give an example for a evaluation board which has a Cortex-M4, a display and some flash: http://www.atmel.com/tools/SAM4S-EK2.aspx. Yet, there is no support for multi-touch, you would have to implement that by yourself (with a display that supports multitouch of course).

Prices for controllers: digikey or farnell will give you a good idea, if you are to produce more than 10k pieces you'll probably be able to find cheaper sources.