I think this proposal is aimed at folks who won't do things like view plain-text documents on a smartphone, which I think is a reasonable assumption/tradeoff. I think bringing up viewing plaintext on your phone is... a misplaced optimization.

Regardless, if your point is that actually interacting with such a document would be annoying, I agree. I think anything that's giving me jagged paragraphs instead of nicely wrapped text would drive me crazy (though I'm a lover of hard wrapped plaintext). I know one day I'll end up "tidying the formatting" of a markdown doc formatted in this way and end up getting linked to this proposal.