I really think it's a regression, as for the recipes I use everything works fine until calibre version 3.39.1, while later versions (I tested 3.40.1 and 3.42.0) inflate the vertical whitespace.
A single "<br>" tag is replaced by 3.39.1 with a single "<p class="calibre8" style="margin:0pt; border:0pt; height:0pt">*</p>" while the later versions replace each "<br>" tag with four of these "<p..> </p>" sections.
I can provide a simple test recipe with the good and the broken epub file generated from it, if that helps.
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