for my first jacket I used sharpie paint marker. It holds up alright, but after it gets rained on enough it fades out and starts turning kinda white.
On my new jacket I used Angelus leather paint and their clear coat stuff over the paint (after preparing the leather with a deglazer) It seems to be holding up really well so far, all though this way is a little more expensive. If you're interested, you can by the leather paint at http://turtlefeathers.net/text/angelus/paint.html