Android OS can handle up to 255 simultaneous touch events. Unfortunately due to limits set by the manufacturers there are no devices (known by me) which can handle more than 10 simultaneous touch events (Samsung Galaxy S II, I'm not sure about the tablets).
This application is able to handle UNLIMITED (umlimited here mean no more than allowed by operating system) number of simultaneous touch events. Don't blame me or my app if your device supports double touch only, please.
It registers 5 touches on Samsung Galaxy S and 10 touches on Samsung Galaxy S II (see screen shots from my Galaxy S II - great device by the way :-) ).
Check out new Paint Mode and have a lot of fun. Use menu button if you want to clear the screen.
Visit http://android.rzeszow.net/ for change-log. Feel free to leave comments/suggestions there.
Requires Android 2+ (2.1 actually)