If you have html markup in the textarea - it gets rendered into the dummy div as is, so for example if you have image tags in your text it could potentially render the image in the dummy div causing your textarea to be much bigger than it should be. Simple fix is to escape all html tags. Around line 101 change to:

var html = this.textarea.val().replace(/</g, '&lt;');
var html = html.replace(/>/g, '&gt;');
var html = html.replace(/\n/g, '<br>new');