That's quite a shame. Fake keyboard is something I would expect from a cheap toy trying to simulate something better. With modern technologies, I guess that if you can fit the keys, you can fit a tiny keyboard (even if it might be difficult to use).
In any case, it won't be cheap for an emulator. Are those (there is NES, SNES too) hardware level emulators (I mean emulating the hardware) or just some ARM or other chip using software to do the emulation?