Can a cheap, low bandwidth, long-distance wifi be physically and electronically possible for public use?
I'm tempted to say this is a contentious issue for discussion, not something with a "right" answer. However, you could investigate the OLPC Mesh protocol. In general, lower carrier frequencies mean lower bandwidth for data on them. It's not so much that they consume more energy (in fact they have greater range for the same transmit power) but that the antenna gets larger or less efficient if size constrained.

If you are trying to do peer-peer networking on a simple phone, the transmit energy associated with the forwarding of packets could badly affect the battery life.