It’d be interesting to know how many users have this exact problem (using only one line return for a paragraph break). I would expect it to be quite low at present since MS Word (most people’s primary WYSIWYG editor) has taught 2 line breaks = paragraph break.
Of course, the irony is that Word 2007 has changed this to 1 line break = paragraph break, breaking convention for a whole load of users.
In fairness to Jeff, Markdown is probably the best input system there is. It piggybacks fairly entrenched ASCII formatting stylistics and converts them into pretty HTML.