As far as I know, consecutive newlines/line breaks (empty lines) in lyrics are reduced to 1 empty line.
If you don’t want them in your lyrics I suggest you fix your tags (if they are embedded) or your lrc files.
Retaining empty lines makes a lot of sense for lyrics to retain the verse structure. See:
Another purpose of empty lines is to signify extended instrumental passages in a song, where highlighting the last sung line for 3 minutes makes no sense imho. Instead the focus is on an empty line until the singing resumes.
However I agree that with the overhauled Now Playing screen configuration options, the lyrics panel can stand out visually as it does not carry over the chosen style. My guess would be that Tolriq will eventually overhaul the lyrics panel as well to either integrate seemlessly with the Now Playing style or to add similar configuration options to it so the user can fully customize it as well.
What you said is correct. However, in the lrc matching software I use, this situation occurs in a large number of files. Manually modifying each one is too energy-consuming. If the software could add an option to remove blank lines by itself, it could save a lot of unnecessary trouble