[Alan]

Yes.

You'll see a section where you can add product options when you scroll down an add/modify product page. Create one option with the field blank and you'll allow customers to write stuff on it. That is for 1 particular product

For a category of product, or lots of categories, use "Global product options" like Shan have said. It's 9 selection down from the Products menu where you found "add item" link.

Enjoy X-cart.