Having an accelerometer on a chip is a great idea.  They are cheap,
accurate and available on more and more phones:
http://www.dimensionengineering.com/accelerometers.htm

The problem is that you are trying to use them for inertial
navigation, which is inherently complex, requires both orientation and
acceleration sensing and some sort of position initialisation.  Don’t
forget that mobile software developers have to make do with *standard*
hardware.
http://en.wikipedia.org/wiki/Inertial_navigation_system

I see that you are clutching at straws, trying to make your use case
work.  To that end, have you considered investigating Wi-Fi based
positioning?
http://www.spotigo.com/products-and-services/spotigo-wifi-based-positioning-solution/

Bluetooth can also be useful, but I won’t comment on that until I have
been allowed to play with the actual Android API. ;-)

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