The editor can just replace characters as typed, e.g. render a / as ÷.

I've implemented a whole rich code editor/language around that, here is an old essay about it:

http://research.microsoft.com/en-us/projects/liveprogramming...

And a more recent version of the system:

http://research.microsoft.com/en-us/um/people/smcdirm/apx/in...