Considering that netbooks come with microphones now, and you can easily put a usb webcam on these things, I would consider a netbook/notebook to be an invaluable tool when it comes to note taking. I couldn't tell you how many times I was trying to scrawl what my org. chemistry teacher was writing on his 4 chalkboards and saying before he had moved on and I was left in the dust.
If the student is going to stare at youtube all day, their grades suffer. Here's an idea: instead of using a stupid bell curve, the stupid fail, the smart prevail, and if it's because one kid was using a laptop to look at porn, who cares? Well deserved.