I think I figured out what's going on. In issue #7275 it was discussed that Adobe Reader doesn't let NVDA differentiate between the two kinds of line breaks, namely, author-generated line breaks such as in poetry or source code, and line breaks created by Adobe Reader automatically to make the text fit within the window. So it was decided to have NVDA simply strip all line breaks from PDF content.
Technically, NVDA is doing the right thing, and the error lies with incorrectly authored PDF files. However, since these incorrectly authored files abound on the web, I strongly urge developers to prioritize usability above technological perfectionism in this case. JAWS went down this route, and succeeded. This doesn't make this route the correct one always, but this time I believe it would do much more good than harm.
A possible compromise would be to make this behavior dependent upon the NVDA option to honor screen layout in browse mode. Why not strip line breaks when screen layout is turned off, and honor them when it is on?
I fully understand that NVDA is currently doing the technically correct thing. However, in this case it breaks the user experience and puts NVDA at a clear disadvantage compared to its competitor, a disadvantage which, in its conquest to be accepted in workplace environments, it clearly cannot afford.