One of Google wave biggest strengths is its ability to let you collaborate with other Google Wave users, as it stand right now anyone you invite to a wave can edit any part of it and if you make the wave public any Google Wave user can edit any part of your wave.

Using the edit tools it's easy to collaborate on a document with one user typing in a blue colour and another in red and of course the play back function makes it easy to what was changed in that blip by who and at what point in the overall flow of the wave.

Adding notes or discussion in sub blips and the private blip function are a great way to discuss what you are collaborating on without lots of (bracketed) notes all over the copy.