I ran into the same problem a year ago while writing my first 'big' cgi script... I had a textarea called 'message', and i wanted to change newlines in <BR> breaks. This is how i did it:

# change newline into <BR>, and return into nothing

$message =~ s/\n/<BR>/g;
$message =~ s/\r//g;

I figure the problem is that on a Windows platform, window is sending a linefeed AND hard return, while *NIX is linefeed only (and mac being hard return only, but haven't tested that out yet)