<apex:component controller="componentController">
    <apex:attribute name="value" type="String" description="Sample component." assignTo="{!selectedValue}"/>
    <p>
    Value = {!value}<br/>
    selectedValue = {!selectedValue}<br/>
    </p>

    <apex:dynamiccomponent componentvalue="{!dynamicControls}" />

</apex:component>

public class componentController {
    public String selectedValue {
        get {
            System.debug(LoggingLevel.Debug, 'componentController.selectedValue get: ' + selectedValue);
            return selectedValue;
        }
        set {
            System.debug(LoggingLevel.Debug, 'componentController.selectedValue set: ' + value);
            selectedValue = value;
        }
    }

    public componentController() {
        System.debug(LoggingLevel.Debug, 'componentController constructor called.');
    }

    public Component.Apex.PageBlockSection getDynamicControls() {

        System.debug(LoggingLevel.Debug, 'componentController.getDynamicControls() called.');

        Component.Apex.PageBlockSection pbSection = new Component.Apex.PageBlockSection();
    pbSection.title='Custom Controls';
    pbSection.showHeader = true;
    pbSection.columns = 2;

        Component.Apex.OutputText test = new Component.Apex.OutputText(value='Dyanmic Component selectedValue:' + selectedValue);
        pbSection.childComponents.add(test);

        return pbSection;
    }
}

<apex:page>
    <apex:messages />
    <apex:pageBlock title="Component page block">
        <c:editMode value="foo"/>
    </apex:pageBlock>
</apex:page>

public class componentController {
    public String selectedValue {
        get {
            System.debug(LoggingLevel.Debug, 'componentController.selectedValue get: ' + selectedValue);
            return selectedValue;
        }
        set {
            System.debug(LoggingLevel.Debug, 'componentController.selectedValue set: ' + value);
            selectedValue = value;
        }
    }

    public componentController() {
        System.debug(LoggingLevel.Debug, 'componentController constructor called.');
    }

    public Component.Apex.PageBlockSection getDynamicControls() {

        System.debug(LoggingLevel.Debug, 'componentController.getDynamicControls() called.');

        Component.Apex.PageBlockSection pbSection = new Component.Apex.PageBlockSection();
        pbSection.title='Custom Controls';
        pbSection.showHeader = true;
        pbSection.columns = 2;

        Component.Apex.OutputText test = new Component.Apex.OutputText();
        // Modified here to use expressions to bind to the property set by an attribute
        test.expressions.value = '{!selectedValue} Test';
        pbSection.childComponents.add(test);

        return pbSection;
    }
}