For a line to be considered blank it must have no information from return to return, if you use forced line breaks it is not concidered blank. (It probably should havve read remove empty paragraphs to be entirely correct in the preference.) If it is the names the space between first and last will mean it is not empty.
Did not solve
Do you have a test file? And could you show extract of the data file (a couple of example lines) and the result?
You are not giving much to help us help you, you said you have this checked.
You have no data what so ever in the lines that should be removed? (not a tidle or even a space)
But isnt this a space character? I susspect the line that is not removed has that space.
So it is behaving as designed a space is a character. therefore the line is not empty (to a computer). You will have to add a find/change where you find a space+return and replace with nothing.
The alternative is to preprocess the data so that "First" space "Last" becomes "First Last"