Finally got this to work! It seems that the nodemailer plugin has a dependency on node v 6.0.0. As soon as I changed the dependency to a compatible version the problem was solved.
Hope this helps someone else facing the same issue.
Nice. You know what would be handy... is having a button to press to put in the empty framework for embedding any image with text that says "Image Description" and one that says "URL of Image". We do a ton of image embedding and most of our users upload them rather than linking to existing content because they can't figure out the markdown to put in.