the only time i have keypad issues is when i am actually in call and have to enter a number or something, usually when i am listening to a menu. When I unlock Talk Lock the keypad is sometimes frozen or non responsive. But if go to the menu and choose display keypad it works no problem
in landscape mode go into options>language and text input>input style=word complete
See if that will help you out.
Seanren78 and Civic are both 100% correct. it is a 5.0 Bug. but if you turn your phone to landscape and go into your options under Language and text input and change Input style from Auto correction to word complete it will fix the entering numbers and getting letters bug