In my mind, one of the bigger goals of Markdown is to prevent the user from typing potentially malformed HTML directly.
Well that isn't exactly working for me in MarkdownSharp.
This example works properly when you have the extra line break immediately after "abc"...

But when that line break isn't there, I think it should still be HtmlEncoded, but that isn't happening here...

Behind the scenes, the rendered markup is coming from an iframe. And this is the code behind it...
<%
var md = new MarkdownSharp.Markdown();
%>
<%= md.Transform(Request.Form[0]) %>
Surely I must be missing something. Oh, and I am using v1.13 (the latest version as of this writing).
EDIT (this is a test for StackOverflow's implementation)
abc
this shouldn't be red