If such a translation were to be done (converting text wrapped in repeated line ends to wrapped by <p></p> tags), then it could be applied at the time a node is posted and need not affect any currently posted nodes.

An alternative that some people may find even better, although slightly clunky, would be to use a PerlMonks editor and paste the prepared HTML text straight into the current edit facility. This would require someone writing a PerlMonks editor of course. :)

Actually, if there is a demand for such a thing, and people could tollerate it written on Tk, I'd be prepared to put my hand up for the job - let me know.