I prefer the current PM algorithm for normalizing user HTML over tagsoup's. We could add more knowledge about allowed parent tags but such would be used to escape tags that aren't in the proper parent rather than to close and reopen tags.

And I feel quite strongly that the priority of goals should weigh practical matters much, much higher than technical milestones like strict compliance with a standard.

For example, <p> tags will probably never be forced to be strictly nested because there is no practical way to accomplish this given the current state of users and browsers.

The disadvantage that this prevents using a (compliant) XML parser on some filtered user HTML w/o first filtering <p> tags is a practical disadvantage but of less importance than the practical advantage of allowing people to easily enter their own HTML mark-up that displays well for most of our audience.

While the disadvantage of <p> tags not strictly complying with any particular standard is not a practical matter. Strict compliance can lead to practical benefits but complance itself is not a practical benefit. So strict compliance can be desirable for many reasons such as setting a good example, geeky pride, pedantic intollerance, etc., but such concerns don't even cast a shadow IMO compared to even relatively minor practical advantages if such conflict with each other.