With Cute Editor, you can defines what happens when the "enter" key is pressed in the editor in the BreakElement enumeration.This enumeration has three values: Div, Br and P. 

You can add one of the following two lines and have a test:

     Editor1.BreakElement  = BreakElement.Br;

or
     Editor1.BreakElement  = BreakElement.P;

 

Online example can be found in http://cutesoft.net/example/oncarriagereturn.aspx

 

Hope it helps.

 

Regards,

Eric