Terminal.app is very good in many ways, but Apple really needs to work on the configuration mechanism before I can use it regularly.
I frequently want to make tweaks to one window, and I just can't stand having to make a new set of Preferences every time a window disagrees with the established settings. Since the sets contain everything (colors, terminal attributes, long lists of key mappings, etc.) there are potentially a lot of things to redo.
Also, what's bizarre is that opening a saved file has the side effect of automatically creating a new, permanent set of Preferences. There isn't much point in having files if Terminal insists on re-storing everything as Preferences anyway.
Try out iTerm sometime. Much, much faster and lighter than Terminal.app. I switched to iTerm when Terminal.app crashed while compiling Haiku ... twice. The problem, I believe, was the large amount of compiler output.
I used iTerm before Leopard, but it crashed at least once a week, and sometimes it would just forget settings, and it used up an insane amount of resources if you left it open for a few days (and shutting down all my ssh sessions and restarting them is not my idea of a good time, nor is trying to figure out where I put this server or that server in the tab list; I like them to stay at the same position so I don't have to consciously think about that).
When Leopard came out, it had a Terminal.app that fixed essentially all my issues with the previous Terminal.app, including having tabs, etc, and it hardly uses any resources at all, and stays open without crashing for weeks at a time (in fact, I don't think I've ever managed to crash it). Now that there's a copy-on-select plugin for SIMBL for Terminal.app, it's just about perfect.
> (and shutting down all my ssh sessions and restarting them is not my idea of a good time, nor is trying to figure out where I put this server or that server in the tab list; I like them to stay at the same position so I don't have to consciously think about that).
I use screen on my servers to avoid losing history and for running non-daemons, but I find it convenient to have "physical" tabs to remind me of where I am.
I recently switched back to iTerm due to its full screen option, which I use when I want to really concentrate and/or see some really wide output. Back in the Panther/Tiger days it used to crash rather frequently, seems a lot better now; I haven't had it crash in some time. I can tolerate the occasional crash because my sessions are always protected by screen.
I definitely feel performance increases all over the place in 10.6. Particularly in Terminal.app... it's super snappy! Directory listings are instantaneous whereas before there seemed to be a slight little lag.
Note: I am using zsh with my term declared as xterm.