This is awesome. I'm using http://ace.ajax.org/ right now in production and it's a huge heavyweight pain (but still the best thing out there). If only this had syntax highlighting i'd switch in an instant.
Thanks so much for the LDT link, it's exactly what I was looking for (and thought impossible).
I can't speak for the GP, but my problem with ACE et al. is that they replace the textarea with their own HTML structure (e.g. a div for every line). I understand the reason why, but it means they have to reimplement all the textbox behaviour and they never get it completely right.
For example: when I double-click on a word in the textbox I'm writing this in, and then middle-click somewhere else, the word gets pasted there.
In ACE, it pastes a different text in a different location.
ACE is brilliant if you want to a full-fledged text editor. But it's an overkill if all you need is a normal textarea with some colours.