In the current version of the Modern Rich Text Editor (RTE v2) used in Dynamics 365 (e.g., within the Customer Service Workspace), users experience unexpected additional line breaks when composing or replying to emails. The formatting differs significantly between:

• Composing a new email
• Replying to an existing email

This leads to a poor user experience and inconsistent email formatting, which can be particularly problematic in professional communication scenarios.

Issue Summary:

• Users notice extra blank lines inserted unintentionally between paragraphs or signature blocks.
• The behavior is inconsistent with how emails are rendered in Outlook or the legacy RTE (RTE v1).
• The editor interprets line breaks differently based on context (e.g., new email vs. reply), causing visual clutter.
• This issue occurs without any manual formatting from the user.

Business Impact:

• Reduces trust in email formatting inside Dynamics 365.
• Users spend extra time correcting layout or switch to Outlook to avoid the issue.
• Hampers the adoption of Customer Service Workspace and internal CRM-first communication flows.

Suggested Improvements:

1. Align the behavior of line breaks in RTE v2 with standard email clients such as Outlook.
2. Ensure consistent behavior between "New Email" and "Reply Email" scenarios.
3. Provide configurable options to define how Enter / Shift+Enter are handled.
4. Offer users a toggle or preview mode to validate how the email will appear before sending.
5. Update documentation with clear guidelines for expected behavior.

Context:

This issue has been escalated through Microsoft Support (SR #2503281420002343), where it was confirmed that the RTE v2 editor is still in preview and this behavior is not yet addressed. There is currently no workaround apart from falling back to the legacy RTE using a temporary URL flag.

If this feature gets improved, it will greatly enhance the reliability of email communication directly within Dynamics 365 and increase user confidence in the platform.