Well, if the name is an acronym: Other words.

I had decided to use a witty/memorable name in the form of an acronym to help "sell" the project a little. 

So now I just had to think of one. I'm guessing that people who are good at crosswords and anagrams would be great at figuring out acronyms too. I'm pretty awful at doing anagrams and I don't think I've ever finished a single crossword puzzle.

Anyways, I started out with a list of keywords which I felt were descriptive of the project in some way:

Frugal | Spartan | Altoids Tin | AVR | ATtiny | 8-bit | Piezo Speaker | Mod Tracker | Sequencer | Editor | Chiptune | Drum Machine | Base Synth | Arpeggiator | Wawetable Synth | Noise 

I made a printout, cut the words to individual pieces, and started combining them. The word FAT, for (F)rugal and (A)ltoids (T)in, soon emerged as a good candidate for the first part of the name. But after that it was slow going. I've since lost the paper where I scribbled down a number of hopeless name candidates but I remember FATDABS, or "Frugal Altoids Tin Drum And Base Sequencer" was one. I mean, that's not even a real word. 

After I had finally arrived at FATCAT, for "Frugal Altoids Tin Contained AVR Tracker", I kind of got mentally stuck on it and couldn't think of much else. The sentence itself does a reasonable job of describing what the project is, except for the final word "Tracker" which doesn't make much sense by itself. It should've be "Mod Tracker" really, but oh well. 

FATCAT as a word doesn't really tell you anything whatsoever about the project, but at least I think it's sort of catchy. And it rhymes with itself. As an added bonus all the letters in FATCAT are 7-segment display friendly, so it can be displayed as a welcome message when the device is powered on.

So there's the story behind the name.