Copying formatted text from a web page to an Applescript input dialog
I tried to reproduce the problem with
on run
    set dialogResult to display dialog &quot;foo&quot; default answer &quot;&quot;
    set newText to text returned of dialogResult
    display dialog &quot;Text entered: &quot; &amp; newText
end run

but at least at first sight it appears to be working ok. Which specific issue did you run into (&quot;won't work&quot; is a bit broad)?

Update
The problem has been fixed in OS X 10.8, just got a mail from devbugs@apple.com:

14-Sep-2012 07:40 PM Apple Developer Bug Reporting Team :
We believe this issue has been addressed in OS X 10.8 (Mountain Lion) GM Seed (Build 12A269).  This pre-release version is available now on the Mac App Store to Mac Developer Program eligible members.  Please verify with this release and update your bug report with the results.