In order for entered text to maintain line breaks when displayed in an HTML page, HTML tags would have to be added to simulate those line breaks.
There are (at least) 2 previous forum messages describing what can be done to allow what you want:
Description Break Lines (formatting carriage returns in event details)
Repeating newlines (related to message above)
You might also want to look into this:
WYSIWYG input area
Those and other useful CalendarScript links, hacks and templates can be found at the Unofficial CalendarScript - Mods and Plugins site.
JFYI
Dan O.
[This message has been edited by DanO (edited March 05, 2005).]