Strange new line behavior

Firstly, I have fckeditor set to insert a paragraph on enter and a line break on shift-enter

The web app pulls text from a database to populate the editor. Here is an example of the source code

<p><font size="6" face="verdana,geneva,arial,sans-serif">July 29, 2009<br />
<br />
ABC Co.<br />
Mr FIRST LAST!<br />
123 Street<br />
2nd St address<br />
Address, State Zip</font></p>
<p></p>

When I click at the end of the document (in wysiwyg view) to edit (I assume this is between the extra paragraph tags) and press enter, it moves the cursor at the top and does this to the source code...

<p><font size="6" face="verdana,geneva,arial,sans-serif">
<p></p>
<p>July 29, 2009<br />
<br />
ABC Co.<br />
Mr FIRST LAST!<br />
123 Street<br />
2nd St address<br />
Address, State Zip</p>
<p></p>
</font></p>
<p></p>

So it adds a blank paragraph at the top...moves all the closing tags around, adds 2 more blank paragraphs at the bottom...

Even worse.

If you edit between the date and the first line of the address and press enter, it erases everything underneath where you pressed. this is the resulting source:

<p><font size="6" face="verdana,geneva,arial,sans-serif">July 29, 2009<br />
</font></p>
<p></p>
<p></p>

Does this make any sense at all? And how can I fix this extremely strange and problematic behavior.

Shift + enter doesn't cause any problems, but we want to retain the paragraph functionality