Much of last night and some this morning was spent going through the on-line tutorials of CadSoft's Eagle PCB design software. They have a freeware version that looks like it will meet my needs. I played with it a few years ago, so much of this was a good refresher and review. After getting through the tutorials, I started my schematic design and noticed that the Avago ADNS-7550 was not on the standard library, so I had to make it. After a few tedious hours, I managed to get my own parts library created with the part I needed in there. I did my best to design the chip from the datasheet showing the measurements. I won't know for sure if I did it right until the board is milled/drilled and I try to slip the chip in the holes, but it looks good at least.
Most of today has been spent making up a shopping list to convert my working breadboard design into a much smaller form of surface mount components on a custom milled PCB. With the new CNC spindle on the way, I wanted to get the PCB design work going so I would have something for it to create. It looks like most of the components (almost all capacitors) are available either an 0805 (0.08" × 0.05" -AKA- 2.0 mm × 1.3 mm) or 0603 (0.063" × 0.031" -AKA- 1.6 mm × 0.79 mm) package. Those are tiny for sure.
I'm still working on what I will do for a microprocessor at this point. It appears that I can take a bare Amtel AVR chip and flash it with the Arduino or LUFA TeensyHID bootloader and make it work and compatible with Arduino / Teensyduino for future play and revisions, even after the product is fully developed. I like the idea that I or someone else can reprogram the code to their liking at a later date to make that LED blink faster or change the default resolution that makes them happy. My biggest issue is finding a reference design and shopping list to make an AVR chip reside happily on a PCB of my own. I'm just not sure what capacitors, resistors, ocillators and so on it needs outboard to make it run.