Okay... to my understanding... removing the wpautop filter has the following effects on the editor:
1. Stops WP from "guessing" where p and br tags should be inserted. So, all content basically runs together when viewed on the front end, regardless of how it was formatted in the visual editor.
2. In HTML mode, you can now use p and br tags (which should function as expected, and save)... but you can not switch to visual mode. If you switch modes.. the tags get stripped out.
So, here is the issue...
How do we create content in the HTML side using p and br tags (and any others)... switch to Visual mode (where the formatting is already kept).. and then switch back to HTML mode (where currently the formatting is being stripped)... but we want to keep the HTML formatting we entered in the first place.
So, where is the issue? It seems that when the editor switches from HTML to visual... the visual side "recognizes" all the tags and displays them properly. But, when you switch back to HTML... it appears the editor doesn't know how to convert those tags back into HTML.
Is there a workaround for this (other than never switching to visual)? I'm not sure...
I'm going to do some research and see what I can find. If you have any links or references where you have seen this working before... please include them here.
Perhaps all three of us working together can find a solution ;)