I thought I would miss the physical keyboard, when I changed over a year ago to touch only I didn't really. Then a friend got a Milestone and I thought I might too, but I tried his keyboard and it's horrible. There's nothing to tell one key form the next and most of the time you end up pressing 4 keys at once... no auto correction there like onscreen keyboard.
Also, I've used things such as SlideIT, Shapewriter and now to the best one, Swype and it makes onscreen keyboards faster then ever. Watch this video -
http://www.youtube.com/watch?v=xaokPG-ZfZY
That's one finger against two as well, you really can type (Swype) very quick with just your thumb.
As for your contract, if your getting the early upgrade, I would think that's more like them doing you a favour, so I doubt you have much leverage. It's not like you can say 'Well I'm going another provider then', 'Erm, sorry sir, you're still under contract with us for 6 more months. You're not going anywhere...'
Also, how much do you like to mess with gadgets? If you like to a lot, take a look at the Nexus One. It's more open than the Desire.