Say i get a 500mh prototype, with a six month lead on commercial production. looking at today's prices and difficulties, that would be quite the handicap.
This situation would obviously be a great win, anyway investing in litecoin hardware development may produce unknown ouputs (if any).
I would aim my efforts in developing a system using some relatively inexpensive mainstream hardware (read SoC, mobile GPU chipsets, ...) that outperforms GPU's _at least_ in terms of energy efficiency at the same buying cost. I don't think hashing performance could be improved much (if at all) with this kind of development, and ASIC development is insanely expensive.