I've got a couple slopes, and we live in an area that sometimes gets very heavy rains. All the mulch I've tried has washed away. Landscape fabric didn't help much - it just made a slicker surface for the mulch to slide down on.
I'm currently using rocks & waiting for ground-covers to fill-in. But in the meantime, I'm getting alot of dirt erosion. I'm almost ready to give up, and go buy a jeep load of sod...
In one area, I hired a local company to install landscape timbers to tier the slope, so the individual planting areas are flat. I'm not thrilled with the look, but using landscape blocks was too expensive, and I needed something fast.
I would also appreciate other gardeners ideas.

Have you considered building swales to slow down the water sheeting down your hillside? It'd be a lot of digging but it might be worthwhile.
I'd also send email to Peaceful Valley Farm Supply here in California (east of San Francisco). http://www.groworganic.com/browse_321_Erosion_Control_Materials.html
You probably have a similar store in your neck of the woods. They sell rolls of jute netting and burlap for short term, and then you can scatter some sort of perennial groundcover that can hold down the dirt.