Horay, got it, thank you for your code, Bob. I'll slowly figure out the extra twiddly bits now. Here's the finished page in distilled form:
<html>
<head>
<style type="text/css">
.mockup {
position:absolute;
left:1px;
top:250px;
width:530px;
height:272px;
z-index:250;
overflow:hidden;
background-color:#b2d0e3;
font-family:"Times New Roman";
font-size:16px;
}
</style>
</head>
<body>
<textarea id="textareaId" rows="11" cols="74"><b>Here</b> is some sample text with tags.<br />This needs to be rendered with formatting.</textarea>
<div id="myDiv" class="mockup">
</div>
</body>
<script src="jquery-1.10.2.min.js"></script>
<script type="text/javascript">
$('#textareaId').keyup(function(){
$('#myDiv').empty().html($(this).val());
});
</script>
</html>