Glossary module activation produces PRE tag in node's output

There is a problem also posted here.

I am using Drupal 4.41, and here's the HTML output from the browser of the relevant part:

<h2 class="title">
<a href="fitness/exercise/pilates_history">Pilates History</a></h2>
<div class="content"><pre>
<b>Pilates<a href="glossary#247"><img src="misc/glossary.gif" /></a></b> method of exercise...
ETC. FURTHER CONTENT TEXT
</pre>
</div>

Obviously the <pre> gets applied. I have taken the CSS related styles out of a module, produced an empty function in my theme and added CSS stuff from the module into my CSS file. The glossary itself is working properly, except for this issue.

My digging through the glossary module produced no solution to the problem: Where does <pre> get produced?

I would really like to get this solved because I really need the otherwise exceptional glossary module.

My filter settings are:

Strip HTML tags On, allowed tags: <a> <b> <i> <dd> <dl> <dt> <li> <ol> <u> <ul> <img> <hr> <br>

HTML Style attributes: Removed

Fix HTML Entities: Enabled

Filter ordering:

HTML filtering 0
BBCode filter 0
Context Links 0
Legacy filtering 0
Glossary 0
HTML entities 0
Image filter 0
Smileys filter 0
textile 0
Title filter 0
URL Filter 0
Weblink filter 0
Wiki filter 0

Experimented changing ordering produced no results.

I have to turn the Glossary module off for the problem to dissapear. I believe Glossary module is great, but I can't use it with this issue. I have tried digging through module, but can't figure why this happens. Additionally, this stretches
the whole layout horizontally (I am using the fixed width), as if all line breaks were removed. CSS interventions produce no result whatsoever.