Linc,
Thanks for this, but it is not working for me, so would be very grateful for any more assistance you can give. I have recorded exactly what I have done which I think is equivalent to your post though different in parts.
I have been in El Capitan for some time and Notes has been working well and syncing across all my devices.
Today I accidentally deleted a Note (including deleting it from the recently deleted folder...dont ask) so it really is gone.
But I have TM running, so I turned off Notes in iCloud (and turned off wifi for good measure), to prevent the restored Notes being overwritten immediately from the iCloud Notes. (At this point there were no notes in Notes of course, because iCloud Notes was turned off).
Then I entered TM, navigated to ~/Library/Containers/com.apple.Notes from yesterday, and selected "restore" then chosing to overwrite the original.
Logged out, logged in and opened Notes, and Notes was completely empty.
Turned on wifi and iCloud Notes and Notes immediately populated with my iCloud Notes (still minus the deleted one course).
I have read that Notes might be stored in ~/Library/Group Containers/ group.com.apple.notes/ and earlier I noted that when I made a test note, the time on the NoteStore.sqlite-wal file there changed. (a similar test note did not seem to change anything in the ~/Library/Containers/com.apple.Notes folder).
So I also tried restoring ~/Library/Group Containers/ group.com.apple. notes/ from Time Machine but again got an empty Notes.
So I seem completely unable to restore Notes from a Time Machine backup.
Any help most welcome.