Could someone please suggest a tool to create a Domain Model diagram? Some details:
JUDE Community Edition for UML runs on Windows, is free, is not pencil and paper, easy to use (IMO), and not Visio. It meets all your criteria - try it.
It's not a pencil and a sheet of paper
A wacom tablet and paint.net?
"Essentially, all models are wrong, but some are useful" George_E._P._Box
It really depends what use you want for the model. If it's use to to let you understand the domain, or communicate to the guy next to you, a pen and paper are probably the best tool.
If you want to put it in a presentation, then Visio is good enough. ( For example, some of the OMG UML specs use Visio. )
If you want to perform more complicated checking and transformation ( unusual for a Domain Model ) or link it to a later implementation model, then a fully fledged model base UML tool.
IMHO, It's ill-designed.
Unfortunately, I haven't used a UML tool that was an easy to use and intuitive as I'd like ( the closest being OmniGraffle which had the ease of use for creating diagrams, but no UML model behind it ).
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