Actually my daughter's teacher has been playing with Eco and is working on a grant to get it for her classroom. One thing that she has come up with for writing was creating worksheets and a 'classroom' book. One thing she has been trying to get away from was tools that had kids write into a computer as they have many of them and while it re-enforces things like spelling, grammer, sentence structure, etc her classroom has less and less chance to 'write' but does a lot of typing. Her age group is such that they still need to use handwriting and while they are becoming good typists with all the computer programs they use less and less are lessons being given that a child is using a pencil and paper and this is an important developmental step as well as educational. She has planned something much like you have here but that the "character back story" gets written by the student and goes into a notebook in the classroom. Then as they work on "world lore" they all share in the job of recording that lore on paper and develop the story into chapters that are added to the book so they have a journal associated with their world.
She makes a good point here that this also allows the teacher to structure the writing assignments around the level of the student; and to structure the required content accordingly too. For example, if the game has places to type in back story and world lore and a world journal, the kids would see the direct connect but if a teacher came up with other writing activities and there were not specific places for those activities that kids would tend to find them less important. Apparently, this has been an issue before as kids have eagerly produced things a game has asked from them and they could enter but when asked by the teacher to do an assignment that was not 'entered' into the game it was greeted by the kids as not being important. So, if the game is not asking the student to enter this writing into the game then no writing - either what the game asks or the teacher comes up with - is more important then the other. And it would also leave it up to the teacher as to whether the writing would be handwritten or typed.