Thought I'd check a few other popular forum software/editors to see how they're handling this...
Invision Community: Paragraphs (with line break support)
vBulletin: Converts all paragraphs and line breaks to line breaks like XenForo
Discourse: Paragraphs (with line break support)
Vanilla: Paragraphs (with line break support)
phpBB: Converts all paragraphs and line breaks to line breaks like XenForo
MyBB: Converts all paragraphs and line breaks to line breaks like XenForo
WordPress (TinyMCE): Paragraphs (with line break support)
Flarum: Paragraphs (with line break support)
A definite trend with the older style forums taking the line break approach. Perhaps seen as easier when dealing with BB code? Still, I hope XenForo can do better and leave that old way of thinking behind, they're smart guys. 
