Re: Dedicated device
"This should be a tiny disposable wearable."
That's a bad idea pretty much whatever you think about the plan. Please consult the following list and choose the rebuttal based on what you think about the idea of tracking contact.
Tracking's great and everyone should do it: With a small disposable device, people will forget to check that it's charged. When they do charge it, it will be away from them and they might do something without it. It might break. In order to sync keys out, it will need a connection to something, probably either WiFi or Bluetooth, which makes it tricky to set up. You have to get one to everybody which is harder than digital delivery of an app.
Tracking's terrible and we should disobey en masse: With a small dedicated device, it becomes easy to verify if someone is complying with tracking. Police could ask to look at it and make it a crime not to have one on you. If the device has a connection, they will know any time you don't have it on. If it doesn't have a connection, there will be the ability to suggest random enforcement checks. With a hardware device, most likely with completely closed firmware, it won't be easy to investigate it, either to understand what it's doing or how to get around it.
Tracking is bad, but in this case a necessary evil: The small device has many downsides compared to a mobile app, see the rebuttal for "tracking's great". It also may lead to additional surveillance afterward, see the rebuttal for "tracking's terrible".
I have to live with tracking: This works in addition to any other opinions you have selected in this list. If we do need to do tracking, and it's done with a device, you need to remember to charge it. To check whether it's working. To not wear it in a place where it gets wet when you wash your hands (I'm assuming they don't make it waterproof because they want them cheap and disposable). To sync it with the key storage place or the key-retrieval-and-checking program on your computer or phone.
Biting the hand that feeds IT
