Would you much rather see a version of a formula represented as: $X^2$ or just X^2
To test this feature surround a formula with
Update: We have enabled TeX processing via the MathJax library. Hopefully this helps for a lot of the edge cases that were reported in this thread.
Update: You should no longer need a sandbox to test MathJax - just stop typing for around 4 seconds and watch the conversion occur in the preview.