MagicPad is a commercial app that is being given away for free for the holidays. It offers rich-text editing — and copy/paste. But note that the copy//paste function only works within a note or from one note to another. You can't copy/paste between applications. The rich-text editing lets you adjust font style, size, color, and effects. You can e-mail notes to others.
Notes
E-mail a note to yourselfSubmitted by Anonymous on Wed, 10/01/2008 - 10:54
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You can sync music and videos as well as Contacts and Calendar information with your PC or Mac, but you cannot sync notes. If you want to transfer a note to your computer, tap on the envelope icon at the bottom of a note and e-mail it to yourself. Then open it on your computer and cut and paste it into the appropriate application.