Installing Cygwin gives you an excellent terminal MinTTY as well as normal CLI ssh. It's my preferred way to do ssh on Windows.

My preferred way to do SSH on windows is to just install any linux distro in a virtual box VM with a minimalist window manager, fullscreen a console and mount all windows disks into it as shared drive if I want to scp things.

Why not fork PuTTY?

There are quite a few forks out there already, mostly with slightly better user interfaces. None of them seem to have much traction though.

There are also some pretty good commercial alternatives although they get drowned out by all the free stuff on Google.

Already been done. Meet KiTTY:

http://www.9bis.net/kitty/?page=Welcome&zone=en

It's not nearly as stable as Putty though. It crashes for me a couple times a week (mainly when connecting to routers)