Weird... I just restored the original tinymce directory that comes with v1.1.1, dumped the browsers cache, and still no html source visible to edit :S
So far I have not installed any plugin. Perhaps it's just a config issue?!
I recon it would be in this section where something might be wrong (in tiny_mce_config.php):
$plugins = array('inlinepopups', 'autosave', 'spellchecker', 'paste', 'wordpress');
$plugins = apply_filters('mce_plugins', $plugins);
$plugins = implode($plugins, ',');
$mce_buttons = apply_filters('mce_buttons', array('bold', 'italic', 'strikethrough', 'separator', 'bullist', 'numlist', 'outdent', 'indent', 'separator', 'justifyleft', 'justifycenter', 'justifyright', 'separator', 'link', 'unlink', 'image', 'wp_more', 'separator', 'spellchecker', 'separator', 'wp_help', 'wp_adv', 'wp_adv_start', 'separator', 'formatselect', 'underline', 'justifyfull', 'forecolor', 'separator', 'pastetext', 'pasteword', 'separator', 'removeformat', 'cleanup', 'code', 'separator', 'charmap', 'separator', 'undo', 'redo', 'wp_adv_end'));
$mce_buttons = implode($mce_buttons, ',');
James, can you otherwise post/mail your tiny_mce_config.php?
Cheers :)