Silly question, what's your OS and what editor are you copying from? I've got the sneaking suspicion the problem lies somewhere between your browser and the editor...
"Reply with quote" usually shows you exactly what's been posted, and there's no carriage returns in your post -- so I would assume that you're either losing them during copy to the clipboard, or when pasting. If you're using an editor that doesn't preserve linefeeds. I've seen this when people use 'textedit' and on a handful of *nix editors. The Linux world in particular can be a nightmare given the variety of different clipboard formats applications recognize (or don't).
Though really, my advice is forget the stupid editor -- the forums are faster and more useful if you turn off the MEGABYTE of .js garbage anyways.
Q: if you type in the PHP bbcode tag by hand, and then post into the editor box your code -- does it have line-feeds in the editor box? If it does NOT show up with linefeeds in the editor window, the problem is NOT these forums, it's somewhere between your browser and your editor.