Before 3.x , reports used to just go to either email or PM, which although OK left a bit of confusion as to who was dealing with what.
There was a reasonably popular modification for the 2.x series 'Reports as topics' which did just that, it created a topic in a designated forum containing the reported content etc, although it would only do reported topics, nothing else though as far as I remember.
I do (just my opinion) prefer the report centre though

, it is an easy to use built in centralised area and relatively easy for modification authors to plug into (so they can add report options for their applications to it too).
Perhaps a feature suggestion for the RC would be to allow comments to be edited ?
@Cyclechat specifically, I did whip up a quick 'Report Centre Guide' to help my moderators use it, although it was written for 3.0.x most of it still applies. I shall post it here (I did post it once before in the Customer Lounge) if it helps (the images are externally linked for convenience) of course you are welcome to copy / paste / amend and use in a staff topic on your site if you want to.
A quick guide on using the Report Centre.
Link
First of all, the link is on the header above the logo. It will change to red if anything is in need of attention:


Notification Options
The first thing I'd suggest is decide what type of notification (if any) you wish to receive for reported content. To do this, click the link and then click the Report Options button:

You can see here you can choose to receive email and / or PM notification of new reports (or no notification at all) , choose what you feel appropriate and save. This option is just for you, the same way as you can choose to receive (or not) notification of new PM's or profile comments etc.

Using the Report Centre
OK, lets take a look at an example:

Here we have a total of two reports, notice the flag icon on the left side. The green one (the lower one) indicates this report has been completed. The other one has a white flag on it, this is the report that requires attention. You can see which section the report came from and who reported it too. Click on the title to view that report.


Here we can see the reported post, the reported message and the reporter. Note there is a comment section here where you can leave comments for other staff as appropriate. This does not effect the topic, all comments in the Report Centre stay in the Report Center. You can also see near the top the text "This report is regarding..." , this is a link to the reported item if you wished to view it (perhaps edit a post etc)
Taking Action
Once you have taken appropriate action as needed, you just need to mark the report as complete. This will turn it off in the header area (it will only show red if anything is needing attention). To do that, at the top click on the "Current Status" button:

You can see there are two options here, marking as complete or marking under review. Typically the only time you will use mark as under review is when you are not sure and want others opinions. Doing this will still leave it marked as needing attention, but it is better than doing nothing as it shows a staff member has looked at it but is unsure of what action to take (or perhaps they need an administrator to act on the report)
Marking it as complete will as the name suggests, mark it as complete.
Useful links
Reported content is also marked on the forum where appropriate, you will see something like this if you are viewing a reported post:

Other content
It's also possible for members to report other members profiles, their Blog / Gallery entries etc. The procedure is the same, a link will appear in the header area indicating a new report and the Report Centre will indicate the item needing attention. You just simply proceed the same as you would do with a post, editing or removing as needed and mark the report as appropriate.
Bear in mind, I did write it for 3.0.x so notification settings are not shown but it should (hopefully) help your staff a little bit.