recently, i bought some Arduino clones known as the Teensy 2.0 from PJRC. the device is thumbnail size at 1.2 in. by 0.7 in., a ATMEGA32, and boasts 25 I/O, 7PWM, and 12 analog pins. there are many small clones available on the market, but most of the designs require you to use a FTDI breakout board. i was really sold because the Teensy includes a USB jack and all for $16 to $19 for the model with pins already attached. the ++ version offers 46 I/0, 130MB and is only a few dollars more.
i have purchased these as part of a wearable i am designing and hopefully i will be telling you all about very soon.