I've long since given up on paper books, but if I still needed them regularly I'd definitely get this app. eHighlighter is a recently released iPhone app which lets you digitally highlight and upload text selected from a paper book.
A demo video of this app has been kicking around Youtube for a while now, and it looks impressive. The operation of the app is fairly straightforward. You take a picture of the page, and after you identify the beginning and end points for the highlighted section the app will convert the image to text.
You then have the option of adding more notes to the converted text as well as organizing your collected notes. You can even generate a citation based on the scanned barcode for the book (how cool is that). And once you're done creating the note you can also export it to Evernote, Dropbox, or via email.
I don't have an iPhone, but I'm especially interested in this app because of last week's news about Evernote. Among the many new features was a new partnership with 1DollarScan as well as an improved camera feature. Evernote's iOS app is now capable of correcting for much of the distortion introduced by the iPhone's camera and the generally less than perfect background conditions (lighting, camera angle, etc). But one thing that Envernote doesn't appear to be able to do is clip just part of a page.
Unless you plan to write over the top of the excess text, copying a full page out of a textbook is often counter-productive. That's why I find myself liking the eHighlighter app; tt lets you copy just the relevant part of the page and thus saves the effort of trimming the excess.
The app is available in iTunes.