I use FORMAT_MOODLE in moodle.org and it uses to work pretty well, but there is some inconsistency between how it's formatted for web and for emails.
Exactly this forum post:
Looks correct in the web, but corresponding email was completely garbled, with chars between the "<" chars some sort of cleaned.
I guess it's a matter of the cleaning (protection) performed on output, agree. But, in any case, it should be consistent in the web and in email IMO. Not sure if some sort of trust bits are affecting this or what, but results are different. And potentially this is happening everywhere.
IMO FORMAT_MOODLE should allow those symbols for easier writing but that's another story, because then images and others could break, unless we make the format more clever (able to detect some allowed tags).
In any case, the problem is current differences between the web and the email formatting. Just that.