If it's too low, it's easy to overlook. If it's too visible, then it's distracting to have it moving while you type. Maybe it should be collapsible/removable?
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We deliberately put the preview below so as to not have to worry about keeping your input in the same vertical position, as nothing can push it down.
The reason we really want you to see the preview is because the automatic indenting can break some syntax in not-so-obvious ways, so without it we would likely see an increase in "broken" syntax. If just a handful of users are asking they could do it with user CSS.