Erik, of course, would rather spend the money for an external RAM, even if you only need one byte of external storage.
naah, I would easily find a way to save a byte. (I have 'saved' up to 100 DATA bytes in some squeezed apps).
Using Keil you use a C main (the rest can be assembler) and implement OVERLAYABLE in your assembly modules and see you data space shrink more than freah cotton in boiling water. Now, if, after doing what makes sense, you still do not have enough memory, THEN the hardware need be changed, NOT some 'exotic' measure need be implemented.
Using the LCD as a scratchpad would make your so called program slow, unmaintainable, incomprehensible and more. I can not accept the idea that if you can save $0.17 you can 'legally' make your so called code unmaintainable by regular human beings.

Erik

PS

if you are allergic to C, the 'C main' need only be

void main (void)
{
AssemblerLoop();
}

for some reason OVERLAYABLE only works if you have a C main.