This weekend was very successful and allowed me to complete a preliminary prototype that has working touch and breath sensors. It is currently a plywood spacer sandwich, but keep in mind that this is for validating the capacitive touch sensors and fingering system.
The main microcontroller is a Cortex M4 development board from PJRC, the Teensy platform. Touch sensing is done via two MPR121 breakout boards.
Furniture tacks are used as keys, and the Freescale pressure sensor allows for breath pressure sensing.
And here's an example of the instrument being played with Reason as the main synth: