I would check two things first:

1) Have you disabled tex filter (and algebra filter)? If tex filter is enabled moodle tries to use filter first and scripts next.

2) What delimiters are you testing? Tex filter may be checking

< tex > TeX expression < /tex >

or < tex alt="My alternative text to be used instead of the TeX form" > TeX expression < /tex >

or $ $ TeX expression $ $

or \ [ TeX expression \ ] // original tag of MathType and TeXaide (dlnsk)

or [ tex ] TeX expression [ /tex ]

and you should set displayMath and inlineMath delimiters in MathJax tags according to your needs. You can find more information about MathJax configurations from http://docs.mathjax.org/en/latest/configuration.html

And once you have disabled Tex filter moodle hides Equation editor from TinyMCE unless you change the setting from settings of TinyMCE in Administration menu http://docs.moodle.org/26/en/Text_editor#Insert_equation

Default delimiters of DragMath in MoodleTex output format are double dollars.