I am just posting this to make sure that the people who work with wmd have seen this update from Fog Creek.

Technically the announcement is from Stack Overflow, an entity distinct from Fog Creek, and run by slightly different people. Jeff et al work on Stack Overflow, but Fog Creek works on Stack Exchange. In particular, SE is still using the old Markdown engine. Around the time when SE comes out of beta (two more months?), recent changes to SO will be merged into SE and we'll all be very happy because we'll have things like advanced search, the preview will match the final output, and we'll be able to edit comments.

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"