Powershell (and cygwin as well IIRC) still have lousy terminal emulators. The issue isn't the lack of good programs nor the shell, it's the Windows GUI "wrapper" around the CLI shell. In Windows neither cmd.exe nor Powershell allow you to alter the width of the terminal in real time. Nor have sane copy/paste options, region highlighting and so on. There's no tabbed grouping, clickable URLs, etc. Sure, some of the aforementioned can be tweaking in the preferences. But on the whole, the Windows terminal emulators are pretty poor when compared to (for example) Konsole.
Cygwin is pretty awful as well. I hear a lot of people suggest it but I really couldn't get on with Cygwin. I found MinGW to be a much better solution (which also ships some pretty cool terminal emulators as well)
I've used Cygwin (with mintty and bash), and it's not terrible. Not as nice as on other platforms, but definitely better than the other things I've seen on Windows.
Before mintty, I used Putty and connected to a local SSH server. Putty is pretty nice too.
Have you tried setting Quick-Edit for your command line? The right-click copy/paste works well enough (though not nearly as good as a linux terminal). But the highlighting is still garbage.
If you have cygwin, you can install gnome-terminal. I use it daily and it is awesome. Way better than console2 or any other windows based emulator I've tried. You may need to install it using Cygwin Ports though.
To be honest, I wiped windows and installed Linux in the end. Since I was trying to make windows behave like Linux, it made more sense just to run Linux.
Cygwin is pretty awful as well. I hear a lot of people suggest it but I really couldn't get on with Cygwin. I found MinGW to be a much better solution (which also ships some pretty cool terminal emulators as well)