I teach at a university, and I still give in-class essay exams that students have to write in blue or black ink (unless they have a designated disability which requires them to use a keyboard).
I confess my own handwriting is awful (always has been -- I got a "D" in penmanship in grade school), but some of theirs is even worse. Not all, however. Most write very legibly, and in some cases, quite beautifully.
One of my husband's students (he teaches law school) challenged my husband's ban of laptops in class, claiming that he (the student) never expects to have to hand-write anything again, and that it was unfair to require him to take notes in class by hand, rather than on a laptop.
The student "lost."
I also ban laptops -- not because I have a problem with them for note-taking, per se, but because 1) students use them for other things, like checking Facebook, which is distracting to them, their fellow students, and to me, and 2) some of them get so engrossed in staring at the screen and trying to take verbatim notes (essentially a transcript) that they are more or less hypnotized and incapable of taking part in class discussion.
<message edited by rumaki on Thu, 08/19/10 2:19 PM>