For some odd reason, my Nexus 5 has now developed this 5 mm strip along the right side where no screen touches are registered.
Note the nice clean border where the phone thinks there's no touch screen.
It's not a large area, but it just happens to be where the scroll bars are positioned, and the letter 'p' on the keyboard. If I'm lucky, I can tap and get a 'p', but most of the time I end up getting an 'o'. Depending on the application, there might be a few other controls along that strip which would be inaccessible. I also can't drag anything to screens on the right.
I've established that it's not a screen calibration issue. With the 'Show touches' option turned on under Developer options, the phone registers screen touches right where I tap the screen, except for that 5 mm strip along the side. This time there's no screen protector or case getting in the way. The phone is completely naked.
I think it was on Saturday when I first noticed the odd behaviour while playing Ingress. I couldn't get something to pop out from the right side of the screen. Didn't think much of it because I thought maybe it was just a UI change that got snuck in. It wasn't until I started trying to do more things with it today that I realized the dead zone was there.
Power cycling and a factory reset (after copying backups off the phone) didn't help matters, so I think it's time to make another call to Google tech support.
Update: After calling Google tech support, a replacement (refurb) phone is on the way. If they determine your phone can't be fixed using their normal troubleshooting, and it's eligible for a warranty replacement, you're sent a link via email to the Google Play store where you "purchase" a replacement. You also get an RMA form and a return shipping label. When the replacement phone arrives, I'm supposed to box up the broken phone and send it back to Google. After the phone is received by Google and checked out, the credit hold from the purchase is removed from the credit card.