it's not out and a no-ball. I believe it can be called a no-ball at the point where it passes the batsman above waist height. Even if the ball then drops onto the stumps it was still above waist height when it passed the batter. Otherwise bowlers could bowl donkey drops into the clouds and over the batsman with the intent to land the ball onto the stumps. With regards to the batter being out of his crease, it would depend how far and whether it would be considered a normal position for a batsman.
Interesting point - we had plenty of high full tosses yesterday in our match. Felt a bit guilty no-balling one in particular as the batsman clobbered it 60 yards over the boundary into the next field!