Hi Macgrl, I am sure you can find the answer to these particular questions, and more on the livescribe website and forums. But, I do use my livescribe even if not recording audio. I do not use text recognition so I haven't tested the impact of illegible handwriting - As long as I can read it I'm fine. So for my GTD system I am either
1) using it just as I would use notepaper. I review meeting notes for projects, next actions and waiting for's which then go into my lists, and 2) easily porting it to Evernote where I store it as reference material.
I'm still waiting to use the Pencast feature which seems pretty niffy.