When I was in school, if the class didn't require me to submit a Word document, I'd write it in LaTeX and submit a PDF. Not only did it motivate me to write (it made boring reports feel more like programming ) but my reports looked a lot nicer than everyone else's.
Since you're not working with the final layout (unlike a normal word processor), it would probably work nicely on a small device like the N900. Just compose in your favorite word-wrapping editor then compile it into a beautiful PDF later.