@RuthFL
There is an alternative way to obtain nice formatting from txt converted via Calibre: Markdown.
Look
here:
"Formatting Style: Markdown
calibre also supports running TXT input though a transformation preprocessor known as markdown. Markdown allows for basic formatting to be added to TXT documents, such as bold, italics, section headings, tables, lists, a Table of Contents, etc. Marking chapter headings with a leading # and setting the chapter XPath detection expression to “//h:h1” is the easiest way to have a proper table of contents generated from a TXT document."