You'll notice that the number line mentioned in the pencast, as well as the text of the problem, is missing. I wrote both in a LaTeX document, which I compiled as a PDF document and printed onto the Livescribe dot paper. The pen does not pick up on the printed text on the page, just the writing done by the pen. I was able to add the problem text and number line back into the PDF version by adding them as a watermark to the Livescribe PDF in Adobe Acrobat.
The extra "hello" at the bottom of the screen was added after the original recording. The Echo Pen picks up on its own writing even if the audio is not being recorded. It seems that the best technique is to hand write the statement of the problem and then record the answer afterward. The other possibility is to just stick with the PDF documents.
In all, I'm not terribly happy with the result. I still think that this could work for making short review videos, but the guiding principle should be to get them done without worrying about the perfection of the product.