Arnold it upsets me that no one from the core or fof teams didn't suggest to check mdarea setting
I'm the one who's been working on the TextEditor stuff (probably including updating mdarea to the broken version 🙈).
To be completely honest, it slipped my mind. To me, something not getting formatted implies a potential bug in the formatter. I hadn't had time to test it myself or otherwise see something that would imply that the issue was with the editor itself.
I'm sorry for the wasted time and frustration on this issue. I know it's not fun, and I wish we could have resolved this easier. On the bright side, 1.0 simplifies the editor stuff and temporarily removes mdarea, so people shouldn't bump into this in the future.