Index: trunk/wp-includes/shortcodes.php
===================================================================
--- trunk/wp-includes/shortcodes.php	(revision 7587)
+++ trunk/wp-includes/shortcodes.php	(working copy)
@@ -47,17 +47,18 @@
 
 $shortcode_tags = array();
 
-function add_shortcode($tag, $func) {
+function add_shortcode($tag, $func, $post_formatting = false) {
 	global $shortcode_tags;
 
-	if ( is_callable($func) )
-		$shortcode_tags[$tag] = $func;
+	if ( is_callable($func) ) {
+		$shortcode_tags[($post_formatting)? 11:9][$tag] = $func;
+	}
 }
 
 function remove_shortcode($tag) {
 	global $shortcode_tags;
 
-	unset($shortcode_tags[$tag]);
+	unset($shortcode_tags[9][$tag], $shortcode_tags[11][$tag]);
 }
 
 function remove_all_shortcodes() {
@@ -66,21 +67,37 @@
 	$shortcode_tags = array();
 }
 
-function do_shortcode($content) {
+function do_shortcode_post_formatting($content) {
+    return do_shortcode($content, true);
+}
+function do_shortcode($content, $post_formatting = false) {
+    $pattern = get_shortcode_regex($post_formatting);
+    if (!$pattern) {
+    	return $content;
+    } else {
+    	$callback_func = 'do_shortcode_tag';
+    	if ($post_formatting)
+    	   $callback_func .= '_post_formatting';
+
+    	return preg_replace_callback('/' . $pattern . '/s', $callback_func, $content);
+    }
+}
+function get_shortcode_regex($post_formatting) {
 	global $shortcode_tags;
 
-	if (empty($shortcode_tags) || !is_array($shortcode_tags))
-		return $content;
+	if (empty($shortcode_tags[($post_formatting)? 11:9]) || !is_array($shortcode_tags[($post_formatting)? 11:9]))
+		return false;
 
-	$tagnames = array_keys($shortcode_tags);
+	$tagnames = array_keys($shortcode_tags[($post_formatting)? 11:9]);
 	$tagregexp = join( '|', array_map('preg_quote', $tagnames) );
 
-	$pattern = '/\[('.$tagregexp.')\b(.*?)(?:(\/))?\](?:(.+?)\[\/\1\])?/s';
+	return '\[('.$tagregexp.')\b(.*?)(?:(\/))?\](?:(.+?)\[\/\1\])?';
+}
 
-	return preg_replace_callback($pattern, 'do_shortcode_tag', $content);
+function do_shortcode_tag_post_formatting($m) {
+    return do_shortcode_tag($m, true);
 }
-
-function do_shortcode_tag($m) {
+function do_shortcode_tag($m, $post_formatting = false) {
 	global $shortcode_tags;
 
 	$tag = $m[1];
@@ -88,10 +105,10 @@
 
 	if ( isset($m[4]) ) {
 		// enclosing tag - extra parameter
-		return call_user_func($shortcode_tags[$tag], $attr, $m[4]);
+		return call_user_func($shortcode_tags[($post_formatting)? 11:9][$tag], $attr, $m[4]);
 	} else {
 		// self-closing tag
-		return call_user_func($shortcode_tags[$tag], $attr);
+		return call_user_func($shortcode_tags[($post_formatting)? 11:9][$tag], $attr);
 	}
 }
 
@@ -129,6 +146,7 @@
 	return $out;
 }
 
-add_filter('the_content', 'do_shortcode', 11); // AFTER wpautop() 
+add_filter( 'the_content', 'do_shortcode', 9 );
+add_filter( 'the_content', 'do_shortcode_post_formatting', 11 );
 
 ?>
Index: trunk/wp-includes/formatting.php
===================================================================
--- trunk/wp-includes/formatting.php	(revision 7587)
+++ trunk/wp-includes/formatting.php	(working copy)
@@ -26,7 +26,7 @@
 	for ( $i = 0; $i < $stop; $i++ ) {
  		$curl = $textarr[$i];
 
-		if (isset($curl{0}) && '<' != $curl{0} && '[' != $curl{0} && $next) { // If it's not a tag
+		if (isset($curl{0}) && '<' != $curl{0} && '[' != $curl{0} && $next) { // If it's not a tag or shortcode
 			// static strings
 			$curl = str_replace($static_characters, $static_replacements, $curl);
 			// regular expressions
@@ -74,6 +74,7 @@
 	$pee = preg_replace("/\n\n+/", "\n\n", $pee); // take care of duplicates
 	$pee = preg_replace('/\n?(.+?)(?:\n\s*\n|\z)/s', "<p>$1</p>\n", $pee); // make paragraphs, including one at the end
 	$pee = preg_replace('|<p>\s*?</p>|', '', $pee); // under certain strange conditions it could create a P of entirely whitespace
+	$pee = preg_replace('/<p>(\s*?' . get_shortcode_regex(true) . '\s*)<\/p>/s', '$1', $pee); // don't auto-p wrap post-formatting shortcodes
 	$pee = preg_replace('!<p>([^<]+)\s*?(</(?:div|address|form)[^>]*>)!', "<p>$1</p>$2", $pee);
 	$pee = preg_replace( '|<p>|', "$1<p>", $pee );
 	$pee = preg_replace('!<p>\s*(</?' . $allblocks . '[^>]*>)\s*</p>!', "$1", $pee); // don't pee all over a tag