A complete rewrite of the Sensor Module firmware deserves a hardware upgrade as well doesn't it?
Introducing the "Sensor Module Backpack" AKA "The Mega Shield"
I've added the 12v to 5v converter, and the Analog and Digital pins will be powered from this power supply which is capable of providing up to 3A. 3A is overkill, but power for the sensors won't be a problem :) I'm also powering the I2C bus from this as well.
I took that picture before I plugged it in, just in case :) Good news, no smoke, no bad smells, just what appears to be a functioning unit. Now I'll take some voltage measurements on the pins just to be sure I hooked it up to the right side of the converter :) If all goes well, I'll plug some sensors in and see if they work using the transistors to switch the power on and off...