Use backticks and blockquotes and code blocks however you damn please. I have the following conventions when I'm editing:
Executable names, backticks
Flows, backticks (e.g. Go to Tools > Options and un-tick the corrupt my data randomly checkbox)
Config files, codebox
Single-lines from config files, backticks or codebox (depending on my mood)
Quoting from ...
What Mark said. Plus
backticks anytime I want a snippet of syntactic code (programming code, CLI, file spec, etc) I want to stand out.
">" for quoting someone else, only. Quoting Wikipedia, the OP, another person, etc.
The four space thing for longer/multiline chunks of syntactic code (config files, programming, whatever)
Generally, "make your post look like an O'Reilly Book" is good advice, provided you have one on your desk (I think most of us do).
When editing, "Make it readable" is pretty much the guiding advice -- If it looks better when you're finished you did it right :)
Generally that means backticks for commands, Quote blocks for quotations/citations, and code ...
Now that you've posted the Readers Digest version... You edit looks essentially fine to me and I see nothing wrong with the way you've formatted it. The only thing I would suggest is to try and add a blank line between sections when they get so long, as it greatly aids readability.
TL;DR, in my opinion the post you're referring to looks better after the ...