After I wrote about using the on-screen keyboard on the Apple iPad, here's a great comment I received from a physician who describes the challenges of "finger drift" when he's typing on his iPad:
The biggest challenge to typing on an onscreen keyboard is what I'd call "finger drift." on a real keyboard you can feel the edge of the keys with your fingertips and you know when your fingers are hitting the edge of a key or that your fingers are getting a little out of alignment with the keyboard below. Your fingers sort of automatically readjust back to alignment with the keyboard. It's one of the reasons that most physical keyboards have that little raised dash on the bottom edge of the J and F keys.
This sort of feedback doesn't exist on a smooth piece of glass and having it vibrate on keypress (haptic feedback) adds nothing to this. Without it, you end up typing a "p" when you intended an "o" and so forth.
The iPad's autocorrect function causes as much grief as it helps. Sometimes it will properly correct a misspelling caused by touchtyping, but sometimes it replaces a perfectly spelled word with the wrong one. While typing "keypress" above, this iPad forced it to become "keyless" instead. Rather ironic.
Incidentally, this is not a problem limited to soft keyboards. It also happens a lot on netbooks where the keys are all smooth and closely spaced, though not as bad as tablets.
Two other major problems I've seen with the iPad keyboard are the nonstandard keyboard layout and the physical limitation of how fast you can press the keys.
The iPad keyboard doesn't, for example, provide an apostrophe key without accessing a secondary keyboard or by pressing the shift key and swiping up on the comma key. This is addressable through easy software changes, though.
The keypress issue is only a problem for very fast typists. If you approach 100 wpm or so, which is difficult, the screen has a hard time discerning between two consecutive keypresses and a single multitouch gesture often resulting in only one of two letters being registered. This is also probably mostly a software issue, but more difficult to overcome due to a need for a built in tolerance in multitouch tap disparity (akin to double click speed settings on a mouse).
Ultimately, the solution for long form text entry will have to be some form of an optional folding keyboard. Dictation will not work due to many environments requiring silence or at least the ability to input text while listening to a speaker or performing an interview (could you imagine a room full of med students in a lecture hall dictating their notes). Handwriting recognition might be a viable alternative, though most touch typists can type much faster than write.
My guess is that some form of add on keyboard, such as one incorporated into a case, will take the place of the soft keyboard for longer text entry and soft keys will be used for short entries.
I touch typed this entire message on my iPad and averaged probably 3 errors per sentence. Had I typed it on a keyboard, likely I would have typed the whole message without a single error or, perhaps one. "