If you haven't heard about DragMath or tried the demo, see this discussion.
In the best of all possible (Moodle) worlds, Moodle WYSIWYG equation editing would be supported by the standard html editor, allowing math students to "write mathematics" directly in the language of mathematics. Students would not have to learn LaTeX, Algebra, or other "markup" languages. Unfortunately, Moodle's current html editor can not do this now or in the forseeable future (see MDL-7306).
DragMath is an external WYSIWYG equation editor, implemented by a Java applet, that can output LaTeX to the clipboard (see screenshot below). Students can use DragMath to construct expressions in a WYSIWYG fashion, then as a final step (with eyes closed), paste LaTeX from DragMath into an html area in Moodle, thereby bridging between the math world and the world of linear text.
The DragMath editor should be readily available in every context in which a student is also using the standard html editor (for example, when entering the answer to an Essay question or an Online Assignment, or posting to a forum). Ideally, the DragMath editor would be automatically coupled to the html editor (e.g., a button on the html editor to launch a DragMath window).
Teachers should not be forced to provide a link to a popup html resource or (even worse) embed the applet tag in the assignment or essay instructions.