We'll still have the problem that sometimes stuff between dollar signs will be interpreted by Markdown (unless Fog Creek allows us to run a custom version of the Markdown engine, which is unlikely). Daniel LeCheminant has modified WMD to automatically look for these situations and insert backticks if needed (you can try it out at http://math-preview.stackexchange.com), but I want to understand the code before I implement it on MO so that I can be confident I'll be able to maintain it if necessary. I'll try to do this soon.
@Kevin: I think WMD = "Wysiwym Markdown eDitor"
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