Interesting that there's not a lot of discussion on this N5 forum regarding handwriting, especially since the S Pen and so many other features of the N5 are so well optimized for free-hand input. We really ought to shout about this more before Apple "invents" handwriting input in an upcoming version of the iPhone - especially since they have just rolled-out their stylus in last week's announcement.
For any interested forumite, I wanted to share my recent thoughts on this topic.
I installed Google Keyboard and Google Handwriting Input on my N5 as soon as I got it. I know and love these apps from my other phones. Shortly after installing, I decided to uninstall them and learn to live inside of the provided Samsung apps to see what they offer - at least for a while. This has been going fairly well until I opened a larger document and found-out that the Samsung keyboard and handwriting apps have the same flaw as Swiftkey - they can't function if the document is more than a few pages. If you are not familiar with this SK issue, just go to their site and look it up - use the term "keyboard lag". It's been a major problem for them for years now.
So, I am back to Google's apps and I gotta say - they are sooooo much better. Definitely faster, better designed and easier to use, IMO. You lose the ability to open the Handwriting app when you extract the S Pen, but that's a minor niggle. The native writing pad is still present if/when you prefer to use that for input on specific fields.
If you haven't tried the Google apps yet, give them a go. They are pretty amazing on this wonderful N5 platform.