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Recently I started to work with mTouch CSM module. It sounded like extremely interesting and high performance hardware to work with. It sounded right! :) there are countless applications for use of this hardware. Touch pad, proximity sensors, readout of capacitive sensors,extreme precision ...

the best way is to try sending received sc character that you try to decode to UART that way you will know why it is not working.
Maybe start with functional program and then edit it piece by piece and checking if it is still working.

My advice is to use UART as best debuging tool.
If you are not ...

Debounce is topically used for push button noise elimination. I guess this is the case here. If that is the case it doesn't have anything with LCD. Really write some more details.
I guess it is 2x16 LCD character display..

you have details about debouncing here :
http://www.electronics-base.com ...

make sure you have correct baud rate.
Try to write something first to uart

Maybe you configured clock to wrong frequency (4 instead of 8 MHz)