hello,
can we use text fields for note taking as well? i know there is a notes field in activity form but i also want to enter and track different type of notes. would that be ok to use text1 text 2 etc... column for that? or what are the use of this text fields?

The custom fields like Text1 - Text30 are there for any purpose you can find to use them for. None of them are used in calculation, so I see nothing wrong with you using those fields.
Do be aware that those fields are limited to 255 characters, unlike the Notes field.

how about entering the same piece of texts to certain activities in text1 column for instance. can we use this to group or sort activities per the text in text1 column?

Yes, you can copy/paste or type values in. You can also customize the field and add a value list to better control what people select.