In the DX SDK docs it says: "When your application requires text input, don''t use DirectInput methods; it is far easier to retrieve the data from the normal Windows messages..." What method do u guys use, the method microsoft recommends or using direct input? Should I use windows messages to handle text input?

It is true that it is easier to use normal Windows messages. If you use DInput you would have to manually convert scan codes to ASCII characters. You must also take care of keyrepeat and such. All of this is done by Win32 API if you utilize it.

You should check out the "Converting scan codes to ASCII"-Article that can be found here: http://www.gamedev.net/reference/programming/features/scan2asc/