From the help.ubuntu.com website:
NOTE: As of Ubuntu 6.10 (Edgy Eft), the default Vim install is a
cut-down version called "vim-tiny". In order to get the full version
complete with the online help documentation, and many of the advanced
functions such as code folding; you will need to install "vim":
sudo apt-get install vim
This should install a (much!) better build of vim, allowing you to do the clipboard cut/paste from terminals. (I do it all the time). You might also install the 'vim-gtk' package to obtain the GUI build, sometimes it's handy to have (I map 'Meta-V' to open gvim for me, hotkeys for the win!)
(There is no need to uninstall the 'vim-tiny' package, it's kinda 'absorbed' into the 'vim' and 'vim-gtk' packages)