I think that the Wiki is actually possibly the best concept that I have seen in a long time. I've spent a lot of time looking at CMSes and CMF's lately, and the fact is that most of these systems are becoming over-bearingly complicated.
The Wiki reduced everything back down to it's purest form: simple documents rendered as pages. Given this extremely open framework to build on, it's easy to go any direction that your intended audience needs to go.
I agree that the concept of wiki markup is a problem in the respect that the average user doesn't understand how to work with it -- ie, a bit of technical ability is required, however minimal, to work with a wiki.
I have seen two projects that integrate HTMLArea into a wiki system (one is WakkaHTMLArea, which can be found on here). While a good idea for non-technical users, it does have a problem for people wishing to run a truely public, open system: the ability to enter HTML code into the site can be very dangerous unless careful, and complicated filters are built to limit the acceptable coding.
I am personall in the early design phase of building a system that will make the wiki more flexible, add rich content, and remove the mark-up barriers.
Oh, and if anyone is interested in my opinion on this: Twiki was actually one of few wiki's that I found to be really poor when I evaluated it. It gets way too far away from the wiki concept with all of the things that have been added to it. I'd recommend looking at MoinMoin, WakkaWiki, phpWiki, WikiTikiTavi.