Went looking for an old Windows app I used to use. Has a bit of a strange interface, but it does good things, and has undo (called backout, don't know why.) Saving is weird, too, but once you get the quirks, it works quite well.
Website's gone, but I found it
here on MobileRead.
Play around with it, you may find a combination of options that work -- plus it's not command-line, so you can see what's happening immediately.
If your text file has nothing, no deducable marker for paragraphs, you may be out of luck, aside from hand-modding.
m a r