Why did D2L let me choose to keep the original formatting of a copy/paste and then not do it?

Hello,
I used Discussion for the first time this weekend. The assignment was to practice APA style 7 writing so it needed to be written in a word processor application and then copy/pasted into the Discussion field. When I pasted the assignment to D2L, a prompt successfully asked me to choose to either keep or discard the original formatting and I selected to keep the formatting. D2L mostly kept my formatting but deleted one paragraph indention in the resulting action (see attached for a screenshot of the exact nature of the deletion). I notified my professor of the issue and it will not effect my grade; however, I was advised to follow up with your IT to notify you of this apparent malfunction. Have you heard of this happening before? I'd like an explanation and notification of how this can be avoided in the future. Thank you!!!