For table cells with short contents it is usually better for wikicode editors to have a whole table row in one wikicode row. However, the VE doesn't respect the existing code style and seems to prefer to create intractable wikicode.
Example: https://nl.wikipedia.org/w/index.php?title=N-term&curid=1671708&diff=51786440&oldid=51670969
I think that this is a consequence of https://phabricator.wikimedia.org/T139780 (in which the table completely breaks if someone tries to put two "paragraphs" into a table that has all cells in one line of wiktext).
That could be, and completely breaking is a lot worse than bad readability of wikicode. However, that breakage could also have been solved by VE not allowing paragraphs in cells or VE changing the cell syntax only when necessary. Either of those would not hinder wikitext editors.
If we didn't let people write multiple paragraphs/separate lines in a table cell, then I think we'd get a lot of complaints very quickly. Your second idea is more feasible from the POV of an editor.
