I would THINK if I reset my iphone 5 to it's original factory setting that the ios 6 would logically be the reset operating system.... am I wrong about this?
Sorry, but yes you are wrong. To reset back to factory settings, you need to restore the device, which will automaticallly install the lastest iOS. The other option is to wipe the device, which would keep the existing iOS on the device. In your case, that would be iOS7.
@cbear7456 You may need to do the Reset All Settings reset to clear up this problem. There are a lot of people with this same problem, and lots of threads discussing it. Most of them refer to it as keyboard lag.
Doing the Reset All Settings reset seems to clear this up for most people.
You won't lose any content, and you won't be downgraded to iOS 6, the upgrade from one version of an iOS to the next is a one way trip because of the way that Apple handles activating the phone when you do the upgrade.