It does format text in the editor pane by default now but uses a big warning with a button to disable it.

However, the built-in code highlighter, much
like in many Lemmy frontends, highlights
some words/symbols depending on the default
language. Therefore, it's best to not use 
4 spaces at the start of each line for a code block.

Instead, this one starts with "```text" and 
ends with "```". No extra indents and I get
to specify the highlighting language!