Confluence has a rich text editor and supports wiki markup. I don't think JIRA needs to support all of these features, but communication would be greatly improved if we could have a toolbar that let you do the following:

• Bold, italic, and underlined text
• Automatic numbered or bulleted lists
• Color text
• Simple tables
• Ability to embed attached images

A field could be defined as "Rich Text", so custom fields could also support this.

Being able to embed attached images in the middle is important, right now they just get added in alphabetical order. But sometimes when you're writing up a bug you're sort of telling a story. I did this, and got this: (pic), and then I clicked this button, and got this: (pic)