Hi.
There's much better handwriting recognisers for Windows Mobile than the cruddy built in ones. Calligrapher (http://www.phatware.com/calligrapher/index.html) is one but I'm sure you'll soon enough get over the text recognition because it sucks (especially compared to the recognition available in Windows Vista).
The best input/SIP method I've found is PocketCM Keyboard available at
http://www.pocketcm.com/. Get it, use either the built in Touch theme or pick up an iPhone/iPod Touch theme and you're good to go.
As for the red button, do you mean the hardware key on the front of the phone?
I remember seeing something a while ago on XDA-Developers (http://forum.xda-developers.com/) about hardware key remapping so I'd probably have a bit of a hunt around there.
