Pastebud - that iPhone copy and paste facility has been updated. I gave it a go by copying the text from their website, and pasting it here;
pastebud enables round-trip copy and paste on your iPhone or iPod Touch, between the two applications that matter the most: Mail and Safari.
And through a clever combination of web services and bookmarklets, pastebud does it without requiring a jailbreak or App Store download.
Pasted from my iPhone!
http://pastebud.com
Simple to use, but limited to mail and Internet which is a shame.

