I tested it and it has to do something with the html element of list i quess. I remember when my attempts to fix it in java htmleditor and it was working very weird. The <li> and </li> elements inserted into document added newline. Maybe it is similiar to this in some way.
themes->themesettings and there :
lister_choices {
gamebook_choice_list_style = inline_no_question
gamebook_choice_list_style_mobile = inline_no_question
}
When i set this as no_list, inline or inline_no_question it works, no additional newline inserted after entering invalid choice.
When i change it to : default, list, numeric_list, numeric_list_always, alpha_list it adds newline after entering invalid choice.