If we try to put in a space while typing, it appears to put in a line/paragraph breaks and goes to the next line. Tried to check formatting but did not see what could be causing this.

This sounds like a similar problem I had once. The text kept spacing out to a different "column" or "next line". The solution was that the document was formatted as "snap to grid", and there was some sort of grid on the document that was not initially apparent. Reformatted the document to remove the grid, and this corrected the problem.