The formatting rules for fossil wiki are designed to be simple and intuitive. The idea is that wiki provides paragraph breaks, numbered and bulleted lists, and hyperlinking for simple documents together with a safe subset of HTML for more complex formatting tasks.
The Markdown formatting rules are more complex, but are also more widely known, and are thus provided as an alternative.
Each wiki page has its own revision history which is independent of the sequence of check-ins (check-ins). Wiki pages can branch and merge just like check-ins, though as of this writing (2008-07-29) there is no mechanism in the user interface to support branching and merging. The current implementation of the wiki shows the version of the wiki page that has the most recent time stamp.
In other words, if two users make unrelated changes to the same wiki page on separate repositories and those repositories are synced, the wiki page will fork. The web interface will display whichever edit was checked in last. The other edit can be found in the history. The file format will support merging the branches back together, but there is no mechanism in the user interface (yet) to perform the merge.
Files in the source tree that use the ".wiki", ".md", or ".markdown" suffixes can be accessed and displayed using special URLs to the fossil server. This allows project documentation to be stored in the source tree and accessed online. (Details are described separately.)
Some projects prefer to store their documentation in wiki. There is nothing wrong with that. But other projects prefer to keep documentation as part of the source tree, so that it is versioned along with the source tree and so that only developers with check-in privileges can change it. Embedded documentation serves this latter purpose. Both forms of documentation use the exact same markup. Some projects may choose to use both forms of documentation at the same time. Because the same format is used, it is trivial to move a file from wiki to embedded documentation or back again as the project evolves.
The comments on check-ins and the text in the descriptions of bug reports both use wiki formatting. Exactly the same set of formatting rules apply. There is never a need to learn one formatting language for documentation and a different markup for bugs or for check-in comments.
Stand-alone wiki pages with special names "branch/BRANCHNAME" or "checkin/HASH" are associated with the corresponding branch or check-in. The wiki text appears in an "About" section of timelines and info screens. Examples:
This special wiki pages are very useful for recording historical notes.