0.8.4 wasn't any buggier than any other version that I know of. It was always pretty solid for me. Though I freely admit that I believe splitting at the cursor in Book View is just asking for trouble eventually.
I refuse to make any sort of edits in Book View, quite frankly.
Actually, from the sound of things, it's likely your system's libxml2 that's buggy. There were other reports of doubling nbsp issues that were traced to flaky versions of libxml2. Any system updates recently?