Some old (pre-smart, pre-camera, chunky ones with small B&W LCD screens) cell phones had a side scrollwheel that was used for menu navigation. I think it was clickable too.
The only more modern take on that that I know of was Marshall's "audiophile" Android phone [0] from 2015, which had a side scrollwheel for volume, but not sure if it was used for navigation.
My first cellphone (Sony) had this. I think it was https://images.app.goo.gl/Xc1RtzQSurxcFktt7
I even wonder if there wasn't haptic feedback. It was so cool at the time and I still miss it.
The dials on all the "medium-end" digital cameras I've owned always worked reliably despite many years of regular use, as do mouse scroll wheels, so I gather you're correct about cheap components.
Come to think of it, the scroll wheel on my Logitech G502 — three-way clickable, switchable between free-scrolling and traditional mode — would work well in sort of handheld hardware scrolling device, and an electromagnetic scroll wheel of the sort used on some newer Logitech mice would work even better, as it could be configured in a free-scrolling mode with variable friction.
The only more modern take on that that I know of was Marshall's "audiophile" Android phone [0] from 2015, which had a side scrollwheel for volume, but not sure if it was used for navigation.
0: https://m.gsmarena.com/marshalls_new_smartphone_is_every_aud...