It's up to the extension author as to what happens to the text between <parser hook></tags>; some will replace variables, some will parse bits of it, and some (quite a few, I should image) will leave it alone and pick bits out as desired.
This particular extension is one of the latter, according to the code.
Rob Church
I didn't even think about templates when I was writing the extension, but now that someone has mentioned it, I'm feeling kind of a "duh" moment. Is there any good documentation around on how to do this type of thing, or any recommended parser extensions to look at? (I've already looked at [[meta:MediaWiki extensions FAQ]] and [[meta:Extending_wiki_markup]])
This is my first parser extension; do you have any recommendations for anything else to watch out for?
Thanks,
Ryan Lane
PS: for the OP, I plan on trying to fix this...