Swype is probably the most popular 3rd party keyboard out there. The problem with it is that it had limitations in coding and licensing. Basically only certain devices were allowed to have the keyboard installed. With different screen resolutions on different devices, it made porting difficult. QVGA devices have never had a chance to use Swype, but those days may be numbered.
According to XDA member, NickHu, Swype is developing backwards so that the few remaining devices with smaller screen resolutions can use Skype. QVGA devices are supported in this latest beta update. Several members are reporting that it works very well. There is even a UK dictionary.
[via XDA developers]