This topic resurfaces every once in awhile and I must admit it is fun to read. Although fun to read, lets stop justifying the unjustifiable.
The code Kobo adds to its kepubs should
- unlock the font size
- unlock the line height
- unlock the page margins (left/right)
- unlock text alignment
and nothing more.
The above settings can be adjusted by the user. Any other unintended side effects (i.e. blank line between paragraphs or ignoring explicitily intented blank lines) is just plain wrong. Not because I don't like it or because I do like it. I repeat, not because I don't like it or because I do like it. No, because it messes (I'm sure, unintended) with the intended layout of the book.
Users/readers who do like additional space are able to increase the line height (point 2 in the list above). That gives a similair effect (not 1:1 the same) and improves readability (at least that is what users say who do like the additonal blank line between paragraphs.)
Back to where it messes up the intended layout of the book.
Epub was originally designed for reflowable content, meaning that an epub reader can optimize text for a particular display device (yes, there is also a fixed layout but I'll skip this as that is a totally different topic/discussion).
Most fiction books contain blank lines to make clear that something has ended or something new is about to start. A good example are scenes in a chapter. Every single scene is usually seperated by a blank line: the scene break.
This is not different for a printed or an ebook. In both print and ebook, a scene is one continuous flow of text.
The problem for the broken code that Kobo inserts in its kepubs is that it breaks intended (deliberate and logical; I used a scene break as an example, but there are many more) book formatting which was carefully designed by the publisher.
The 'broken code' added to kepubs inserts an empty line before/after every paragraph, which can not be found in the original epub (Adobe epub) or printed edition of the book (both are designed by the publisher). And if you compare book and Adobe epub they are nearly indentical in the way they 'reflow' text. Not the exactly the same as a screen is slightly different than a sheet of paper. Identical in where (at certain positions) to expect a blank line (and are deliberately added by the publisher; i.e. before/after a scene: the scene break, before/after subheadings, etc.)
That's what goes wrong with kepub. There is hardly any distinction between anything as every paragraph is followed by a blank line. And you won't find a double blank line at a scene break. No, the deliberately insert blank line is ignored.
About the publishers
Are publishers not to blame? Sure they are. As DNSB mentioned in a previous post, in the old days publishers definitely messed things up with tons of easy to spot (and thus easy to fix) OCR errors but nowadays, ebooks aren't full of those errors anymore.
No, I'm not saying that ebooks are perfect now, but printed book are also not perfect as they too contain errors: spelling and grammar errors. Hopefully, just a few and hopefully get fixed by the publisher before a new print run. But don't count on it.
Today, you can still blame the publisher on how they format their books. Not that a digital editon looks different than the printed editon. They look very much alike.
You can blame publishers in the way they format their CSS. Too often you'll find that almost every property contains redundancies like font size, line heights, margins, etc. and creates inflexible ebooks.