I'm going to weigh in here with something that doesn't seem to have been considered.
I don't give a **** about the phone. Seriously. Some dick steals it (which hasn't happened to me before) I'll just buy a new one.
I care greatly about the security of the data on the device. I keep backups, so I don't care about _losing_ it, but I don't want it disclosed to the thief or whoever ends up with the phone. The FDE in Android is most of the solution to this problem. My Nexus device can have the bootloader locked, so an attacker can only install factory software images (which won't compromise my data, and will immediately alert me that - hey - this isn't my ROM). To unlock the bootloader the attacker has to nuke my data. So I'm perfectly fine with the current state of affairs as far as the bootloader on the Nexus devices goes.
However, even if I lock the bootloader, an attacker can boot into Cyanogen Recovery and install a trojan-horse ROM that'll bone me when I "find" my phone. This is the hole that I want to close with an optional password-protected Recovery.
And yes, I do realize that I am paranoid. However, this approach has already saved my ass with Truecrypt on my laptop. The thief would have taken the laptop with him out the window if he hadn't turned it on and realized it was a brick.
I am with you, but it simply won't be possible until your manufacturer implements it or open source their bootloaders. The latter will never happen, because if they do, you might find multiple backdoors for "freedom loving" governments, which nowdays include all western governments+.
Also, even if you have a bootloader password, nothing prevents a thief from flashing stock rom wiping everything without ever accessing bootloader. So, you also need a mechanism to prevent access to flashing mode. Again, no one but your manufacturer can do it...
I see only one solution: if your phone has a separate charging outlet, epoxy usb connection, get rid of external sd card and epoxy that socket too. Then encrypt your phone, and before losing, turn it off. That way it might be quite difficult even for a state adversary to get to your data. Yet, they still have other means of "talking" you into turning the phone on for them: fingers jammed in the door?
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