This small alteration to the PHPList code will produce better line breaks.

sendemaillib.php:

  $text = preg_replace("/<\/p\s*?>/i","<\/p>\n\n",$text);
  $text = preg_replace("/<br>/i","<br />",$text);
  $text = preg_replace("/<br \/>\n+/i","<br />",$text);
  $text = preg_replace("/<br \/>/i","<br />\n",$text);
  $text = preg_replace("/<table/i","\n\n<table",$text);

The technique is to first normalize br to br /, then remove line newlines after br tags. Then, you re-introduce newlines, so each br has only one newline after it.