I replaced Notepad with Notepad2 on all my computers when Roy Osherove recommended it back in 2004. I've really appreciated it - it's small and lightweight like Notepad, but has some great features like syntax highlighting, block selection, and regular expression search.
A week ago, Jeff Atwood sent a funny e-mail about a Notepad2 dialog that annoyed him. It didn't bug me at all, but it got me curious about other notepad replacements. I took a look at Notepad++ and immediately made the switch.
The main feature that drew me in was the multiple document (tabbed) interface - you can see in the shot above that I've got three documents open. Simple enough, but it really cuts down on the clutter. Once I started using Notepad++, though, it was the plugins that blew me away. The big plugin is TextFX (included, no separate install necessary), which turns this simple notepad into the Swiss Army Knife of text editors:
Now, don't go freaking out that this is too complicated - remember, this stuff's available in a menu if you want it, but if you want simple just look at the first screenshot and pretend I never showed you the second.
I wrote a quick Notepad++ autocomplete file for C# which includes most of the keywords, commands, and common namespaces.