We have waited long for this (which wasn't useful for me) but at last we have our Copy-Paste Feature.

It has been released with the new WP7 Developer Tools patch.

Download it here if you haven't yet!

Now lets test it!

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We have TextInput with the given text above. Click on a word there:

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The icon is the copy button. You enlarge it by clicking arrow buttons next to the word or choose a word and copy it.

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When you click the button it will show in a panel below waiting for you; re-click to finish the copy-paste process:

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See? Now choose somewhere in Textbox and then click the button below:

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It was pasted!

This I had not seen in the previous version of the VS RTM. Absolutely a good addition for the future.