Before this gets out of hand -- again, I'd like to suggest that both sides of the debate are 'right' -- for their own purposes. The only thing that would be 'wrong' would be to suggest that a physical QWERTY is best for everybody or that virtual keyboards are all anyone ever needs.
People who use a keyboard with one finger and /or look at the keys or at their hand when typing will do just fine on a virtual keyboard. Swype may even be faster for those folks than a physical QWERTY.
Typists who watch the display "and let their fingers do the walking" on the keys must have physical keys with discrete palpable edges to do so. If you touch-type, then you know that tools like Swype and word completion mostly just slow you down. Vibrate feedback is useless for blindly locating the correct positon of the key among it's neighbors before you press.
This issue continues to usurp entire threads to no good end. And it's simply because these two different styles of typing approach the keyboard differently.
Neither physical nor virtual keyboards are inherently superior in all situations. Rather each is best suited to the needs of a particular type of user.
Perspective instantiates reality.
[From DX by HoFo app.]