When converting an unstructured FM book to HTML5, any list items (numbered or bulleted list) that had inline images were displaying wrong (messed up indentation, multiple list items displayed on one line). For some reason, standard body text was not affected, only list items. My list items are set to "Convert to text" in the HTML5 settings file (for other formatting reasons).
I fixed this problem by activating the option "Clean inline HTML styles" in General Settings. Hurray!
The knock-on problem is that my dynamic HTML items are now not displaying properly. DropDownCaptions are displayed "open" (instead of closed) and are shown with both the open image and the closed image before the text. When closed, they show neither image.
Before I activated the "Clean inline HTML styles" option, these dynamic HTML items were displaying correctly.