When you select Check Spelling as You Type in the contextual menu, it works for every text field on the current page you're on, but if you go to a new page it reverts to not checking.
This feature is behaving the same for me in production Safari 2.0.4 (419.3) on Mac OS X 10.4.7 (8J135/PowerPC) as it is for a locally-built WebKit r15401. The Safari tab that the preference is set in seems to remember this setting. You must set it for every tab in every Window that you open to turn it on. Note that this is different from setting the WebContinuousSpellCheckingEnabled default, which currently doesn't enable spell checking by default for all text fields and text areas. (Perhaps this is a different bug, although no one has filed one to my knowledge.)
(In reply to comment #1) > Note that this is different from setting the WebContinuousSpellCheckingEnabled > default, which currently doesn't enable spell checking by default for all text > fields and text areas. (Perhaps this is a different bug, although no one has > filed one to my knowledge.) Filed Bug 9887 for this issue.
From what Richard said, this seems to be a duplicate of Bug 9887, which has already been fixed. When you change this setting (cont. spell checking), it now carries over to new windows/tabs and is also remembered after you quit the app. However, in shipping Safari, when you check this setting in one window, open a new one (which carried over the setting as well) change the setting there and return back to the original window/tab, the setting is not changed. In other terms, change the setting to "on" in window A, open a new window B and the setting will be "on." Now, in window B, change the setting to "off" and return to window A, the setting is still set to "on," however, all new windows have it now set to "off." In ToT, if you change the setting in window B and return back to window A, the setting has already been changed to whatever it was set in window B. So, there are differences in behavior but I'm not sure if this particular bug is still actual.
<rdar://problem/4960639>
Vladimir's right; this was fixed by the change for 9887. I consider the behavior Vladimir describes for window A and B to be correct, but if someone disagrees they should file a separate bug about that. *** This bug has been marked as a duplicate of 9887 ***