I don't know when this started happening, I know that I've recently updated my theme (Thematic, with my own custom child theme, latest Thematic version is 126.96.36.199) and I'm not sure when I last updated WordPress, but it's on the latest version (3.4.2).
When I create a new blog post, then save the draft, then come back to it later, all the paragraph formatting goes away. I don't use the HTML editor, I always use the visual editor and it has always worked fine until now.
I have a backup of Thematic before the update so I'm going to try uploading that and see if it fixes anything, but my site is being slow right now. Until then, what other solutions could I try?