When I use the dictation feature in OS X, sometimes some of my text has got dotted blue underlining below it after entry:
What does this mean? Am I able to use it to correct the mistakes in the text more easily?
I am using OS X 10.8.
This highlighting "hyperlinks" the text, if the system is unsure of what you said. It will typically take a couple of best guesses, and display them as options from which you can choose from. You can see the suggestions by right-clicking the word or control clicking it.
It also selects the text when you click on it, which allows you to simply type a replacement if the options provided aren't correct.
This article may provide helpful information on dictation.
The blue underline allows you to control click and select from alternate transcriptions of the sounds for that phrase.
The blue underline is similar to the red underline that appears when the system detects alternate suggestions for a typed word.
In this case, it might have a high confidence that you could have said one of several phrases and offers you both an indication that there is some doubt about that dictation as well as a shortcut to choose from an alternate word choice.
Oddly, this isn't covered in the Mac Basics: Dictation article that does have a helpful list of editing tips and punctuation words that are supported.