Comment by hello_computer

Nelson's arguments sound odd to me. He says that embedded markup is bad for WYSIWYG editors since they have to maintain a connection between the raw and formatted text streams (which can have different character counts, etc.), but out-of-line styling would similarly need careful implementation work to keep it synchronized with the text stream at all times, even with concurrent editing and other such features.

(Cf. how the cross-reference stream in PDF files makes it painful to edit objects in them, even when the files are nominally encoded in plaintext.)

He then goes into how a separate styling layer can assist with transcluding text from other people's work while modifying the style. But style variations are hardly the only legitimate changes typically made to direct quotations: people often want to modify capitalization or punctuation, elide portions, or insert bracketed notes. And at that point, you're modifying the content as well as the styling, so style-only modifications would be very limiting for that use case.

As for the structure layer, this would have the same issues as every other attempt in the last three decades to create a semantic web or whatever. Authors don't want to spend their time carefully curating metadata that 99.9% of readers won't care about, while bad actors want to game their relevancy metrics through any mechanism available.