What effect does downwash have on the horizontal stabilizer
First, the downwash extends over a wide height, so moving the tail up or down will change the local downwash angle only a little (first order approximation: By the cosine of the elevation angle at which the tail is positioned).

Next, downwash at the tail is a good thing: Since the downwash angle increases with angle of attack, the angle of attack range at the tail is smaller by the downwash effect than it is for the wing. This keeps the tail in a narrower band of angles and allows it to still stay firmly in the linear range when the wing is about to leave it (which happens when the wing stalls).

What you don't want to happen is that the wing wake hits the tail. The wake contains the wing's boundary layer and produces an undesirable drop in dynamic pressure at the tail. Initially, tails were moved up to avoid the wing wake impinging on the tail (think MiG-15 or F-101 Voodoo), but that only shifted the eventual point where the wing would blanket the tail to higher angles of attack. With the reduction in aspect ratio and the increase in wing sweep made possible by more powerful engines, the upper angle of attack limit went up and the tail could not be moved up enough. Therefore, all modern designs try to put the tail as low as practical and even add some anhedral. Here the limit is of course a tail strike, so you might get the impression that the tail is in line with the wing. At practical angles of attack it isn't.