Thank you! The Qt documentation is very good, but there is lots of it. Your keywords pointed me to the right direction.
To save other noobies an hour or two, here is where the keys were found:
All Overviews and HOWTOs in general and especially, Supported HTML Subset. I hadn't realized the qTextEdit used HTML inside!
Here is some example code:
The more familiar I get with Qt, the more I like it.
; // Go to 4th character of second line; the <br> counts as one character.
cursor.insertHtml("<FONT color=green style=\"BACKGROUND-COLOR: yellow\">"+s+"</FONT>"); // make them ugly
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