A single misspelled word on a line that is not followed by a space. So if I write 'lhflshf' and hit enter right away the spell checker doesn't pick up that there's something wrong.
If a misspelled word is followed by a space then the spell checker does display the misspelled word, however, if that misspelling isn't fixed before hitting the enter key to advance to the next line it will no longer be underlined once the enter key has been hit.
This may be related to: [Browser Bug] Spell checker not working properly
This issue occurs in Firefox 4.0.1 and Chrome 11.0.696.65. I understand that it may be between TinyMCE and the browsers but if that were the case then I would expect for it to be consistently off, not inconsistently with the first line always retaining the underline whereas following lines do not.