I gained some insight by going to this website http://gigaom.com/2009/05/20/show-document-easy-no-signup-live-document-collaboration/ where I found some helpful information that allowed me to correct the problem with allowing another person to edit the document. One feature I like is that in order to invite someone to collaborate you simply have to send them a link by typing in their email address. When you do, you get a screen that looks like this:
They will get a get a screen that looks like this.
They will simply need to click on the button to join the session. Then they simply wait until the host invites invites them in. This indicates to me that it must be real time collaboration. It doesn't seem to work quite the same way as Google Docs where a guest can simply log on when they want to collaborate and get started. Here is a very simple document I created as a simply test. I've changed the color of the text to indicate that there are two different people writing on the document. A very small cursor appears toward the bottom of the page with the name of the person who is currently writing.
I gave the collaborative white board a try as well and was pleased with the ease of use. In general I find Share Documents to be a helpful, easy tool to use. I'm more familiar with Google Docs and prefer to use that tool, but as an alternative, Share Documents would work well for allowing students to work collaboratively on a document.