That reply doesn't answer th eposter's problem in the slightest!
I have exactly the same problem: one of my clients called asking how to make lines of text into a bulleted list. The Editor doesn't know how to do that, instead it takes the whole paragraph and makes it into one big bullet point. NOT USEFUL!
And this isn't the only place where this WHOLLY UNINTUITIVE method occurs. If I select two words in a paragraph and with to make them into an H1 headline, your Editor turns the whole PARAGRAPH into a headline!
These are disturbing issues, given that a editors have been around for years now and are on a par with desktop programs and b) people are used to the MSWord methodology, whether they use that program or not.
PLEASE look into this, it is a showstopping set of bugs!