My idea (unproven) would be to keep the original document around, and by comparing that with the new document (using a somewhat intelligent diff algorithm) determine which changes have been made at a given point. These are then simplified to a set of text insertions and deletions. Insertions are shown by marking the new text with a greenish style. Deletions are shown by inserting widgets (as per #139) with the deleted text styled red.
Keeping these synchronized as the document is edited (in an efficient way) is left as an exercise for the reader, for now. Also how the diff algorithm will work, and whether we want to be intelligent about moving pieces of content, will require further study.