I use Penultimate for short names and numbers but it really doesn't cut it for serious notetaking.
Been using Note Taker HD for a week now and really like the app for making serious pages of notes and sketches. It's basically a split screen so you can finger write on the lower half and the notes are shrunk and echoed on the top half.
It's the nearest I've found to taking lecture notes. Best of all it works with my big fingers as I wouldn't be able to keep a stylus for long.
Check out the videos on Youtube to see how it works.
Just a clever solution to the problem of writing on the pad.