Also thought I would mention SlideIT, which is a replacement keyboard similar to Swype and is available on the market as a free trial and a paid app. I actually prefer SlideIT to Swype (and the fact that I don't have to jump through stupid beta signup hoops to get the .apk file...) Works on all Android versions, give it a shot.
Here's a demonstration of it in action:
http://www.youtube.com/watch?v=xf0iu...layer_embedded