Notepad is probably one of the most simple and useful applications that comes with Windows from its first versions. It's really useful for a lot of tasks but unfortunately it's always remained the same...
Florian Balmer has written a new implementation of Notepad (Notepad2) that it's really nice, with lots of features and a toolbar with buttons.
Features
• Customizable syntax highlighting:
• • HTML, XML, CSS, JavaScript, VBScript, ASP, PHP, CSS, Perl/CGI
• • C/C++, C#, Java, VB, Pascal, Assembler, SQL, Python, NSIS
• • INI, REG, INF, BAT, DIFF
• Drag & drop text editing inside and outside Notepad2
• Basic regular expression search and replace
• Useful word, line and block editing shortcuts
• Rectangular selection (Alt+Mouse)
• Brace matching, auto indent, long line marker, zoom functions
• Support for Unicode, UTF-8, Unix and Mac text files
• Open shell links
• Mostly adjustable
Omar Shahine has posted also instructions for how you can actually replace the Windows notepad.exe with this new Notepad on his Blog:
http://blogs.msdn.com/omars/archive/2004/04/30/124093.aspx
I want to install it! 
UPDATE: A terrible error of mine... I've wrote that Notepad2 was written by Omar Shahine, but it's wrong. The author is Florian Balmer... I'm terrible sorry... Excuse me Florian, but today it's saturday, and maybe too much relax can help me to do erros like this.