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    Would you consider adding the keyboard component from Kodiak as an option?
It's another interesting take on how to handle touchbased text navigation and I'm rather fond of it. Best of all, it's opensource! https://github.com/adamhoracek/KOKeyboard/
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Textastic already supports a cursor navigation wheel and swipe gestures.
See http://www.textasticapp.com/v4/manual/lessons/How_can_I_bring_up_the_cursor_navigation_wheel.html and http://www.textasticapp.com/iphone/manual/lessons/How_can_I_move_the_cursor_using_swipe_gestures.html