Orkut currently has added Transliteration tool on orkut only for Hindi which is based on http://www.google.co.in/transliterate/indic/Hindi.
The Google labs tool has 4 other indian languages which are not integrated into orkut as of now.
This script adds this tool as an iframe in your scrapbook. Just click on Show Indic Transliteration and it opens up the iframe. You can hide by clicking at the top right of the tool.
Since you cannot run script from one site on another i cannot integrate this with the scrapbox directly. you need to manually copy and paste from the tool. I don't think thats really a big task at least simpler than opening a new tab transliterating there copy from there and coming back and pasting.

Currently the script opens up with Telugu as default.
Change the below part in your script to change the default setting
var baseURL="http://www.google.co.in/transliterate/indic/igoogle/Telugu";
//Replace Telugu with Tamil,Kannada,Malayalam or Hindi