Zoe, surely peak/off-peak would be covered by the time you touch in or out, or perhaps by touching in on that particular train.
Your same smartcard may also be your seat reservation, which might also activate the seat-back screen (e.g. if you've got a Velo TV subscription loaded on the card too) and you may even be able to scan the same system (if rolled out to more intercity trains) to mark your seat as 'in use' if you pop to the toilet, bar, or request and purchase beverages to be brought to your seat.
I'm getting carried away now, but a small bit of plastic could do so much and offer many other commercial benefits if someone creative gets involved with the development and roll-out.
There are far too many interested parties involved (politicians, software comapnies, TOC's, local authorities) to alleviate the danger that a national smartcard would be anything other than a horse designed by a committee! My worries are compounded by the feeling that the main reason for bringing smartcards in is to save money by cutting jobs, rather than as a genuine attempt to make access to public transport simpler and more attractive, which is what should be the driving force, in my humble opinion.
If the railway remains privately run, I'd expect a lot of clever ideas to be implemented that offer loyalty rewards, volume discounts (by tracking users, by name or anonymously) and the ability to encourage passengers to travel at quieter times, by offering deals if you travel at those times. You might offer discounts for going against the flow (some seasons did offer this, but seem to be gradually disappearing) and so on.
it would be in the interest of the TOC to do all of that, as they'll have a better way to secure revenue and usage than the current system that splits revenue. For once, you may actually be able to divide the revenue exactly, if users touch in/out on the trains too. If they have an incentive to do so, like getting points, they'll do it. No more tickets with 'NOT XXX' and the risk of a PF. If you opt to take another train, the system will calculate everything for you, so that TOC now gets a slice of the revenue.
I could come up with ideas forever, and then contradict myself as I think of something else, so perhaps I should stop now and just leave it by saying I think smartcard ticketing is the future and is inevitable. Like you, I hope it gets done right. I also hope smartcards are easily available, with no up-front deposit, so everyone can get one on their first journey, then register it to qualify for the various benefits.
I just want ATOC to come out and say that it fully supports the idea, and to say how it plans to do it - and when. It would also be good to see some TOCs coming up with ideas on what they think they could do.