My updates to the Markdown.sugar are now merged into the main project here:
http://github.com/dc/markdown.sugar/tree
I didn’t make any changes to the extensions, but the syntax itself should be quite a bit more accurate (it’s able to process everything in the Daring Fireball syntax docs, and will embed HTML correctly in most cases). Please note that every selector has changed to conform better with the Espresso Sugar Standard. There’s probably a little wonkiness left, but overall it should be much more in line with the naming scheme being followed by other Sugars. You’ll need to update any Markdown specific items you have in themes, and also note that the placeholder theme name is now “markdown” instead of “text.markdown”.
Let us know if you have any problems with the new version of the Sugar! This is still David’s project, but I’ll definitely help out as I can.