I upgraded my Movable Type installation from version 3.2 to version 3.31 yesterday. For some reasons, the upgrade killed Markdown and Smartypants. I’m anal about typography so that was unacceptable. So I downgraded back to version 3.2 and I got my curly quotes/comma and dashing dashes back. Yay! Happiness! :)
Have you tried Smartypants? I find it to be pretty invaluable.