If you were having problems with your keyboard on the edges and the space bar when trying to type try the gingerbread 2.3 keyboard. Works great for me and i no longer have problems typing and using the space bar.
I thought that as long as you change it back to the original density after or before the last reboot, then I will change to keyboard to a larger size, but put the UI's density back to it's original size. I could be wrong though. I'm going off using this on my Droid X, so it definitely could be different.