auto-fill-mode refers to the variable auto-fill-function to determine how to fill lines. auto-fill-function is always a local variable, making it easy to define your own function for any mode you like. To solve my own problem, I use the following:
(defun tws-markdown-auto-fill ()
(setq auto-fill-function 'tws-markdown-fill-function))
In Markdown, two spaces at the end of the line cause a hard line break. markdown-mode highlights those for you, because otherwise they are indistinguishable from soft line breaks. It seems you have trailing white space in your diagram.
However, this is a bug since it shouldn't apply that face to trailing whitespace inside a code block.