Data URIs have been around for quite some time, but browser support is still limited. They allow you to define the data that a URI will return directly in the URI itself, and thus there's no server involved at all. The browser reads the URI, interprets the data and displays it accordingly. As such you can directly specify an image's content from within your page's HTML itself.
I'll explain below a bit more about how it works at a later date, but for now, putting it all together, this is what you get...
If your browser supports data URIs (IE 8 for instance) then it should be fully functional. If it also supports Web Workers (Firefox 3.5), then it should run that bit smoother. Unfortunately only Firefox supports passing JSON messages between workers, other browsers only support passing string messages, so for now, in those browsers I'm not using native Web Workers either.
Obviously there are improvements that can be made and bugs to fix, but for now, enjoy your doodling! Oh, and if you do create a masterpiece and wish to save it then you can do this by choosing the cursor tool and right clicking on you picture, the usual image context menu including a save option should be available.