I'm having the oddest issue and for the life of me I can't trace the cause.
I can't enable Markdown for the Admin group on my live board. I can enable it for other groups just fine. I can also add the Admin to that group but that doesn't help. However, I can test out other users' permissions from the Admin account and that DOES work, but that would make for one heck of an awkward workaround...
I've tried disabling and deleting data to start over, but that didn't work either. On enabling the extension, Markdown is disabled for Admin (i.e. in post editor it says Markdown is OFF, and the disable Markdown checkbox isn't there). On my testboard it works out of the box.
The most frustrating part is that on my test board it works as expected. On my live board it doesn't. But the two are seemingly identical (as far as I can tell).
I wouldn't be surprised too much if it is user error somewhere. The only difference I can currently think of is that on the board where it doesn't work, I use more custom permission roles than on the test board, where I rely mostly on the standard phpBB ones (like Standard Access + Polls etc...). But they should work, and Permission Tracing results in an all-clear (result: YES) for Markdown, it just doesn't do it.
Could there be anything wonky left in the permissions at all on the extension side? Like there seems to be a permission for Markdown in signatures, but I haven't seen that in the ACP anywhere... might not be related...
I'm trying hard to reproduce it somewhere that I could give you access to, but no luck as of yet. In the meantime if you have any ideas please let me know?