I've been using an application called "WinMerge" lately for document comparisons, but one of the requirements of my teams script files (for auditing purposes) is that when we release a revision of a script we highlight the changes in red (RTF format I believe, it's through Lotus Notes) To that end, is there any software that can automatically highlight changes for me or is the best I'm going to get a list of differences and be expected to manually highlight all changes?
If an HTML report is acceptable, Beyond Compare can generate a comparison report that highlights differences. You can use the built-in stylesheets or a custom internal one to style the differences in red (the default is a light red color already).
It doesn't seem to be able to generate RTF, but perhaps there is a simple conversion between html/css and rtf.
Assuming an HTML+CSS solution meets your needs, this article from Linux Journal shows a shell script that reads diff output and writes an HTML document with colored text highlighting the differences.
On Windows, it would probably work as-is under bash as provided in the MSYS environment from the MinGW folk or in bash from Cygwin. The script itself isn't too large, I would imagine it could be ported to Perl with only a moderate effort.
Since converting HTML to RTF turns out not to have a trivial solution that I've found, you might have better luck porting the script to directly output RTF.