I'm not sure about which version of Latex plugin are you running, but try upgrading it: (Confluence Admin > Plugins/Add-ons).
Before using XHML format to edit texts, Confluence used wiki-markup as default. So you if you are running an old version of this plugin it should use wiki markup to work.
So, try upgrading this plugin and check if the behavior persists: https://marketplace.atlassian.com/search?q=latex
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