Lines and paragraphs are automatically recognized. The <br /> line break, <p> paragraph and </p> close paragraph tags are inserted automatically. If paragraphs are not recognized simply add a couple blank lines.
You may embed videos from the following providers vimeo, youtube. Just add the video URL to your textarea in the place where you would like the video to appear, i.e. http://www.youtube.com/watch?v=pw0jmvdh.
Web page addresses and e-mail addresses turn into links automatically.