I traced the error to a missing call to the "htmlspecialchars" function. When a normal page is edited, this function is called on the data retrieved from the database. You just have to change two lines in your
/modules/news/modify_post.php which are:
114-oldshow_wysiwyg_editor("short","short",$fetch_content['content_short'],"100%","135px");
114-new: show_wysiwyg_editor("short","short",htmlspecialchars($fetch_content['content_short']),"100%","135px");
122-old: show_wysiwyg_editor("long","long",$fetch_content['content_long'],"100%","300px");
122-new: show_wysiwyg_editor("long","long",htmlspecialchars($fetch_content['content_long']),"100%","300px");
HTH,
Chris