This subject is quite interesting for me, too.
First, my personal view is that I like to have paragraphs separated by one empty line.
FBReader, which I use extensively on my EEE, offers the possibility to introduce such a line by making it possible to adjust the distance between paragraphs in a properties tab. Mobi reader software does not offer that possibility. Neither do any hardware readers, afaik.
So it's up to personal preferences for the ebook maker, I guess. Worth a feature suggestion to mobi and the hardware readers, though.
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