I really need to spend some time sitting through the iOS tutorials to see what other functionality I'm missing out on.
The old selection method is still terrible and needs to be revamped
I understand that there are lots of gesture/touch target reasons for the current infuriating, knob-based interface, but I tried to switch to an iPad for full-time long form writing and just couldn't. Basic text entry is okay, but doing any sort of serious editing, i.e. selecting and moving a sentence somewhere else in a paragraph is just pure torture. Life is too short.
I am really surprised this isn't mentioned more in iPad reviews, especially since the reviewers are (kinda) long form writers! Maybe they are writing their iPad reviews on a laptop?
I haven't seen this feature mentioned anywhere but I just discovered it one day for the same reason you are annoyed. The feature works on iPhones and iPads alike.