1. The external document like "notepad", they has not the <p> target, when you copy the content from editor and paste into these external document, the <p> target has been removed. So editor will parses the line break as <div>.
2. The paste content is based on your browser copy/paste function. Editor will parse the content from your browser. If the original content has style, then editor will use it too.
If you do not want it paste include any style setting, please try setting EditorOnPaste="PastePureText"
<CE:Editor ID="editor1" runat="server" EditorOnPaste="PastePureText">