It appears others managed to do this even easier. The good thing is no root required - works on any Android phone, or at least on my G1 worked perfectly
Originally Posted by Teksoft
Despite the current Bluetooth limitations in the Google Android SDK, in early 2009 we've developed a first version of our Bluetooth Keyboard driver for Android. It was an OEM Project targetting a major hardware manufacturer, and it wasn't released to end users. The initial version also required root priviledges, so it needed extra skills to be used on normal Android devices.
Almost a year after, some considerable development progress has been made and we're now announcing the Teksoft BlueInput for Android, a Bluetooth Driver that allows you to connect a Bluetooth Keyboard to your mobile device for increased typing speed, more productivity, and a new feel of comfort gained by using high tech all arround you.
BlueInput is an advanced HID driver that totally transforms your Android into the perfect Mobile office solution by offering easy Bluetooth connectivity to Bluetooth Keyboards. And it is ready and waiting for you to try it right away.
This application is not free, but the trial version can be used as much as you want, but has a limitation on using the SPACE and ENTER keys.
Source: Teksoft - Future Teknology