Thank you for your input Paul.
Sadly in didn't seem to work. I did ticked "always preserve" but it still came out as a chunky one paragraph text on the other side once I generated the target text.
Maybe I didn't get the "parse it from scratch" part right. What exactly does it mean? To generate the target text?
Anyway, thank you for your input, I will try again on my next XML file and see if I missed a step.
I meant that after making this change to your XML filetype in File -> Options, you then need to open the XML again or create a new project with this change. This will ensure that the bilingual file you create for translation has taken into consideration the change in the filetype setting.
Generate the target text is simply an expression for saving the translated XML file... however you do it.
If you can share the file I'd be happy to take a look at it?