Having got this far, and looking at the statistics in Xilinx ISE which showed I was using about 1% of the 1200K gate chip on the Nexys 2 board I decided to try a bit of downsizing. I ordered an WaveShare Open3S250E board:-

http://www.waveshare.com/product/fpga-tools/xilinx/xilinx-boards/open3s250e-standard.htm

which at around $35 is rather cheaper that the board I was originally using. Like the Nexys 2 board this has a Xilynx Spartan 3E chip, albeit a much smaller one with only 200K equivalent gates, and an EEPROM to store the configuration. Unlike the Nexys 2 its a pretty bare board with 4-Leds, a mini joystick and a buzzer. It also lacks an on-board USB programmer but as that is also around $35 from the same place and can be used for many other projects it seemed worth a punt. I also ordered a VGA adpator for it @ $4...

http://www.waveshare.com/product/modules/misc/vga-ps2-board.htm

So I was ready to go. As almost all the outputs are brought out onto standard connectors, I also calculated I could remove the SPI expanders and connect the Typewriter buttons directly into the system, freeing the expander boards for my next project.

Getting the basic CPU working initally was very quick. The existing code required only changes to the I/O pin mapping and a couple of tweaks to stop un-connected buttons randomly clearing memory to get to the stage where the basic slider ran. After about a week of fiddling its now all running on the new board with the typewriter buttons connected and all the funcionality working. I now use the "L-Stat" switches on the front to choose which program is loaded when the "Load" button is pressed, but I am now really please with the machine. Next step is to clean up the VHDL for the smaller FPGA an who knows some one else might build one...