I think the plan is to completely rework Serial Monitor, as outlined by one of the primary Arduino IDE developers here:
We get copy/paste/find/select-all for the Serial Monitor for free.
I agree that it is a significant defect. I periodically copy data from Serial Monitor to a spreadsheet in order to produce charts. But I can't do that without line breaks.
I suspect that this is one of the things that will be resolved automatically by the switch to the new Serial Monitor, but you are welcome to submit a dedicated formal bug report about it on the issue tracker. I already checked for an existing one and didn't find anything relevant.
It must be using some odd encoding because I do get line breaks when I paste the data here in a forum reply, only I get doublespaced output!