Wanted: Magnetometer LED Matrix Controller

I have an idea for a light grid control module for home usage, based upon the assumption that a grid of LEDs will be used as overhead lighting in a room, not to dissimilar to this instrucable:

The materials should roughly include:
- a ferrous plate (copper, or alloy to possibly reduce cost)

- magnets (could be non-rare earth, to keep cost down)

- magnetometer sensors and a circuit to determine magnetic field strength (example: 

- transformers (possibly)

My thought is that either one or, most likely, a grid of magnetometers could be arranged in such a way that it is placed in a circuit that resides almost directly behind a ferrous plate. 

When magnets of varying field strength and size are placed onto the plate, sensors would detect the field strength and given the relative location of the field based upon which sensor(s) is/are activated, send a value that will cause a controller to allow however much current to that respective light and (possibly linear) falloff to neighboring lights in order to create a low-resolution (think 8-bit) "spot gradient".

In the off state, all magnets would be removed from the plate, or power to the circuit would be disabled, or power to the lights would be disabled.

Ideally this controller would be mounted in the place of a wall switch, with some kind of reservoir for the magnets to reside when they are not attached to the ferrous plate.

It should have the most simplest setup possible to reduce cost.  It could be done with a regular circuit or an arduino-based controller, I think.

All input welcome.  Unfortunately I am not an EE and have only a rudimentary of electronics, but I think this is totally possible.