I disagree. This is a bug. Markdown specifically states two spaces at the end of a line for forcing a break. We can probably all agree this is a stupid subtle rule. 
Some people write in other editors and wrap long line. For example… writing in Vim or Emacs in a terminal and adhering to a strict #-chars text width. When I view those files in Obsidian, or any other visual Markdown rendering app, I expect those paragraphs with line wraps to expand to the full width of the window.
As Obsidian is implemented right now paragraph text is squished as a result of those forced newlines-to-breaks and it looks terrible.
I know people will think differently on this topic and the solution is easy. Make it a configuration toggle so the user can enable forced newlines-to-breaks or ignore newlines when rendering.
This isn’t a new idea… for example, Typora has this config feature.