Could you explain the overall use case and the intended arrangement a bit more?
I understand that your overarching use case is a sensing device for the blind or visually impaired. Why would you want to use a touch-less gesture interface in that scenario -- wouldn't a physical rotary encoder, joystick etc., which provides tactile feedback, be preferable? Where would the gesture detector be physically mounted; how far away from it would the user's hand be; what "field of view" and range of distances does the gesture sensor need to capture?
There was no clever idea behind that. I haven't planned any buttons, only on/off and maybe indoor/outdoor mode. Imagine if person needs to press some button urgently, having a white cane in one hand and a heavy bag in the other hand, there is a chance that something will be hit by a white cane while hand is moving to some buttons. My reasoning may disappoint you. I've bought relatively popular affordable sensors and modules, one of which was proximity sensor. It provided good data at very short distances. After some experimenting, I've made a not very reasonable decision to investigate gesture sensing, because data looked good, and I did not want to waste this function. Also, there is a deeper underlying problem. I was asked by people to show them stuff, to bring "the device downstairs". It made me feel kind of ashamed and angry at the same time, because there is nothing to show. And if I bring up time and money constraints, I'll probably hear some cliche answers I do not want to hear. To sum up, the main goal at this stage was to impress an investor, to show cool features, to make experience similar to a good toy. In other words, device should provide feedback about surrounding objects position and movements in a such a way, that sighted person would want to play with it and try to navigate without any prior training. After getting finances I was planning to exit my job and focus on making prototypes, pushing them to some association of the blind, do real tests, data recordings, receive feedbacks, go through prototyping iterations. Another aspect is that my motivation source is satisfaction from engineering and problem solving, I can't say that I care too much about disabled people, I can feel empathy, I can be terrified by idea of becoming blind.
Now I put some "clever" ideas.
Physical controls you've mentioned are much better for this task. My initial view was to avoid any controls at all, just a simple on/off button. Controls limits user when both hands are busy with something already, or wearing mittens, gloves, etc.
Gesture controls may be useful if device is head-wearable which easily displaced when touched. With gestures, you can do some simple controls while wearing carrying some object and all fingertips are busy. No need for tactile feedback to find right button.
I've preferred cheap sensors and modules, bought several modules, all below 20 USD.
I've preferred sensors with low bandwidth information. I was planning on using cortex M7, and processing need to be not non-heavy low power consuming.
Radar: provides a lot of useful data over very low data. Very cheap if custom designed using FETs as resistive mixers.
Camera: provides a lot of data, but very high bandwidth. Plan was to heavily decimate the data, kind of ROI algorithm that throws away everything but few small rectangles, which then fed to angle extraction algorithm based on curve tracing. No time for FPGA at this stage
IR gesture sensor: a lot of data with a super low bandwidth. Can put several of these for almost 360 degree coverage.
Lidar: expensive and high bandwidth, I did not like demo videos of modules with data processing
Ultrasonic: not considering it
About rotary knob. As my optimism in accessibility device faded, I've generated more ideas. And few months ago, I've felt a great potential of gesture sensing for entertainment, industrial, hobby and more. Touchless vinyl scratch effects, DJ deck, musical instruments, guitar pedals. Working in gloves, touchless controls that can be used with thick gloves covered with dirt or sticky goo. Bluetooth/USB connected HID devices for personal computers, new ones or keyboard/mouse enhanced with gesture "window" for gaming or other purposes. Password input using finger micro-movement, alarm micro-gesture panic buttons embedded in the floor, etc.