Resistive Touchscreen directly (no touch controller)

Looks great - it could make a really handy module...

About pins, what you've got looks good. Personally, I'd change the code to use the multiple digitalRead/Write functionality - and just for safety I'd make sure you switch the pins to inputs before you set the other pins to outputs...

I'm not sure if using digitalRead (instead of analogRead) will work for setting state, but it's worth a try.

Also it's worth trying without the setTimeouts - as the code takes a while to execute anyway, you'll probably find you don't need them.

var readXY = function(callback) {
  var xy = {};
  digitalRead([C2,C3]);
  digitalWrite([C1,C0],1);
  xy.x  = analogRead(C2);
  xy.x2 = analogRead(C3);
  digitalRead([C0,C1]);
  digitalWrite([C3,C2],1);
  xy.y  = analogRead(C0);
  xy.y2 = analogRead(C1);
  callback(xy);
};

or with multiple reads:

var readXY = function(callback) {
  var xy = {};
  digitalRead([C2,C3]);
  digitalWrite([C1,C0],1);
  xy.x  = (analogRead(C2)+analogRead(C2))/2;
  xy.x2 = (analogRead(C3)+analogRead(C3))/2;
  digitalRead([C0,C1]);
  digitalWrite([C3,C2],1);
  xy.y  = (analogRead(C0)+analogRead(C0))/2;
  xy.y2 = (analogRead(C1)+analogRead(C1))/2;
  callback(xy);
};

One neat addition would be to detect taps without polling, and then to only poll when you know a finger is pressed. I'm not 100% sure if this works, but what about:

function listen() {
  pinMode(C0,"input_pulldown");
  digitalRead(C1);
  digitalWrite([C2,C3],3);
  setWatch(function() {
    pinMode(C0); // reset pin state
    // start polling... when finger is released, stop polling and call 'listen' again
  }, C2, {edge:rising, repeat:false});

That'd effectively stop using CPU cycles when a finger wasn't pressed. For other applications where you want long battery life it'd be handy too.