How to expand node's size dynamically when the text in its textBlock is being entered?

OK, here’s an updated extensions/TextEditor.js file that has been customized to keep the actual TextBlock.text updated with the text being entered into the HTML textarea. I have named this file TextEditorRealtime.js.

Note that your requirement of having the edited TextBlock continuously be changing means that the undo/redo behavior will be different than with normal editing. With TextEditorRealtime.js each entered character will modify the diagram; whereas normally nothing in the diagram is modified until the text is accepted. Furthermore, text validation won’t happen until after all of the changes have already been applied to the edited TextBlock.

But I assume these are acceptable compromises in order to get your required behavior, or you wouldn’t be asking for it.

"use strict";
/*
*  Copyright (C) 1998-2017 by Northwoods Software Corporation. All Rights Reserved.
*/

// HTML + JavaScript text editor menu, made with HTMLInfo
// This is a re-implementation of the default text editor
// This file exposes one instance of HTMLInfo, window.TextEditor
// See also TextEditor.html
(function(window) {
  var textarea = document.createElement('textarea');
  textarea.id = "myTextArea";

  textarea.addEventListener('input', function(e) {
    var tool = TextEditor.tool;
    if (tool.textBlock === null) return;
    tool.diagram.startTransaction();
    tool.textBlock.text = this.value;
    tool.diagram.commitTransaction("input text");
    var tempText = tool.measureTemporaryTextBlock(this.value);
    var scale = this.textScale;
    this.style.width = 20 + tempText.measuredBounds.width * scale + 'px';
    this.style.height = 10 + tempText.measuredBounds.height * scale + "px";
    this.rows = tempText.lineCount;
  }, false);

  textarea.addEventListener('keydown', function(e) {
    var tool = TextEditor.tool;
    if (tool.textBlock === null) return;
    var keynum = e.which;
    if (keynum === 13) { // Enter
      if (tool.textBlock.isMultiline === false) e.preventDefault();
      tool.acceptText(go.TextEditingTool.Enter);
      return;
    } else if (keynum === 9) { // Tab
      tool.acceptText(go.TextEditingTool.Tab);
      e.preventDefault();
      return;
    } else if (keynum === 27) { // Esc
      var tb = tool.textBlock;
      tool.doCancel();
      tb.diagram.startTransaction();
      tb.text = TextEditor.originalString;
      tb.diagram.commitTransaction("cancel text edit");
      if (tool.diagram !== null) tool.diagram.doFocus();
    }
  }, false);

  // handle focus:
  textarea.addEventListener('focus', function(e) {
    var tool = TextEditor.tool;
    if (tool.currentTextEditor === null) return;

    if (tool.state === go.TextEditingTool.StateActive) {
      tool.state = go.TextEditingTool.StateEditing;
    }

    if (tool.selectsTextOnActivate) {
      textarea.select();
      textarea.setSelectionRange(0, 9999);
    }
  }, false);

  // Disallow blur.
  // If the textEditingTool blurs and the text is not valid,
  // we do not want focus taken off the element just because a user clicked elsewhere.
  textarea.addEventListener('blur', function(e) {
    var tool = TextEditor.tool;
    if (tool.currentTextEditor === null) return;

    textarea.focus();

    if (tool.selectsTextOnActivate) {
      textarea.select();
      textarea.setSelectionRange(0, 9999);
    }
  }, false);


  var TextEditor = new go.HTMLInfo();

  TextEditor.valueFunction = function() { return textarea.value; }

  TextEditor.mainElement = textarea; // to reference it more easily

  // used to be in doActivate
  TextEditor.show = function(textBlock, diagram, tool) {
    if (!(textBlock instanceof go.TextBlock)) return;

    TextEditor.tool = tool;  // remember the TextEditingTool for use by listeners
    TextEditor.originalString = textBlock.text;

    // This is called during validation, if validation failed:
    if (tool.state === go.TextEditingTool.StateInvalid) {
      textarea.style.border = '3px solid red';
      textarea.focus();
      return;
    }

    // This part is called during initalization:

    var loc = textBlock.getDocumentPoint(go.Spot.Center);
    var pos = diagram.position;
    var sc = diagram.scale;
    var textscale = textBlock.getDocumentScale() * sc;
    if (textscale < tool.minimumEditorScale) textscale = tool.minimumEditorScale;
    // Add slightly more width/height to stop scrollbars and line wrapping on some browsers
    // +6 is firefox minimum, otherwise lines will be wrapped improperly
    var textwidth = (textBlock.naturalBounds.width * textscale) + 6;
    var textheight = (textBlock.naturalBounds.height * textscale) + 2;
    var left = (loc.x - pos.x) * sc;
    var top = (loc.y - pos.y) * sc;

    textarea.value = textBlock.text;
    // the only way you can mix font and fontSize is if the font inherits and the fontSize overrides
    // in the future maybe have textarea contained in its own div
    diagram.div.style['font'] = textBlock.font;

    var paddingsize = 1;

    textarea.style.cssText =
    'position: absolute;' +
    'z-index: 100;' +
    'font: inherit;' +
    'fontSize: ' + (textscale * 100) + '%;' +
    'lineHeight: normal;' +
    'width: ' + (textwidth) + 'px;' +
    'height: ' + (textheight) + 'px;' +
    'left: ' + ((left - (textwidth / 2) | 0) - paddingsize) + 'px;' +
    'top: ' + ((top - (textheight / 2) | 0) - paddingsize) + 'px;' +
    'textAlign: ' + textBlock.textAlign + ';' +
    'margin: 0;' +
    'padding: ' + paddingsize + 'px;' +
    'border: 0;' +
    'outline: none;' +
    'white-space: pre-wrap;' +
    'overflow: hidden;' // for proper IE wrap

    textarea.textScale = textscale; // attach a value to the textarea, for convenience

    // Show:
    diagram.div.appendChild(textarea);

    // After adding, focus:
    textarea.focus();
    if (tool.selectsTextOnActivate) {
      textarea.select();
      textarea.setSelectionRange(0, 9999);
    }
  };

  TextEditor.hide = function(diagram, tool) {
    diagram.div.removeChild(textarea);
    TextEditor.tool = null;  // forget reference to TextEditingTool
  }

  window.TextEditor = TextEditor;
})(window);