Arbitrary Bullet Point Behavior

I'm using the (relatively) new bullet formatting feature in Illustrator. It works fine for isolated lists, but I'd like to be able to select some text in a paragraph, add a bullet to the first line and indent the rest of the text.

However, it seems to arbitrarily add indenting and/or bullets to one or two lines before or after and I can't get rid of them -- not in "Paragraph" formating or anything else I've tried. Adding extra line breaks doesn't do anything either.

I tried using the feature where you right click Bullets and Numbering and select "convert to text." In one video I saw, this allowed you to go in and delete the indents and extra bullets, but that's not working.

I'm wondering if I'm bringing formatting in from Word (or in some cases PowerPoint) and it's somehow overriding or messing things up. I would hate to have to recopy and paste everything I've done -- so I'm wondering if there is some way to remove that formatting in Illustrator if that's the issue.

Thanks!