Writing Pad is an iPhone app that allows you to "speed write" text using the virtual keyboard. Basically you run your finger through the letters of a word and the software cleverly works out which word you were trying to "type". It's quite accurate and will give options when there is a potential choice. With practice I would think it is a quicker form of typing than the basic keyboard. The text does have to be copied and pasted into another application, though and this is where the iPhone lets the app down. The only way forward that I can see is to e-mail the text.
The screen shot shows some nonsense I typed in by randomly moving my finger over the keyboard. The last word, sociopath, was a bit of a surprise but you will see that the software also came up with an alternative that would be preferable!
One additional comment that applies to quite a few apps - it works best when the iPod is removed from my incase leather case. That makes it a lot less productive unless I buy a different case!