I have a prototype pen that I am working with.  It is made from a whiteboard marker shell with an IR LED in the location where the whiteboard marker tip is normally.  I found an easy way to hold the LED in the pen is to use part of a foam earplug - the kind you roll in your fingers and then stick in your ear where it expands to block the sounds.  I rolled the foam around the "legs" of the LED and then placed it in the tip of the barrel.  When the foam expanded, it nicely held the LED in place.

Actually I did use another earplug to mount the switch.  I have a small hole in side where the button of a microswitch sticks out.  It is held in place with an earplug.  By doing this, I can easily take it apart etc.

I still need a good way to mount a battery inside the marker case.  The single AA battery holder from Radio Shack does not fit inside....

[NOTE: If you want to see the pictures you need to log onto the board]

Using a whiteboard marker housing (same as a highlighter housing).

Here are some pictures showing the foam earplug holding the switch and the LED in place.  I got the idea of a bigger hole to mount the switch from another post on this site (thanks!).

I also attached a quick diagram of a possibility of a tip switch.  I was thinking of mounting a microswitch to a round disk (red square) that fits inside the housing.  I will then "glue" a short plastic rod (red) to extend the mechanical switch to the end of the tip channel and "glue" the LED to the end of the plastic rod.  When you write, the LED touches the surface of the whiteboard and depresses the short plastic rod activating the switch.  On the backside of the switch is a resistor and battery.