Hi JSW,
First of all i have to say i don't have a SP3 so i am testing on SP1. When i write text using the pen i am able to convert it to written text and edit it. I know what you are after and this should work. As i understand it you have written text and converted this. The conversion worked but left in a couple of errors. Did you try to click the container which was converted. If so you were not able to edit the text. In that case try copying the container to a new page and then try to edit it. It might be that SP3 is having some issues there. Did you try the pen 'button' to see if that would give you any alternative options?