Hmmm... okay, well, it's not HTML at all, so it's obviously not trying to interpret the code (which you don't want anyway). It's formatting it as if you put it in CODE tags (preformatted text) which it's not doing for me in 7.0 by just copying/pasting the code into a post using the HTML markup pulldown.
In any event, the end result is expected: Instead of pushing your forum's right sidebar out of view and adding a horizontal scrollbar in your browser (IE), it's just doing that for the post to maintain your board's layout (FF). The same thing happens when people post large pictures, or use the CODE tag with really long lines of text.
7.1 fixes this for IE:
11-26-2006: 7.1 Change: Modified the styles so code/php/quote tags will overflow properly in Internet Explorer.
