I'm not sure if this has been fixed in the latest sdk (downloading it now) but there seems to be a bug in the direct3dx Font.DrawText() method. When you use the DrawTextFormat.WordBreak format the lines get broken at punctuation marks as well as whitespace so that fullstops (periods), commas, apostrophes etc. at the end of words can get split to the next line which is really undesirable behaviour.
I currently have the oct 2005 sdk so I'll see if the latest makes a difference.

Font.DrawText() bug
Dr. NO
Email your repo steps and any code to directx@microsoft.com they *might* pick it up from the forum but the email is the only official way.
Also post it in the beta forums since this is also in MDX 2.0 http://msdn.microsoft.com/directx/beta/default.aspx
Steve001
KyleT
mduffin
The new directx v2.0 DrawString() method still has this bug. To replicate simply run the text3d sample (any version). There is some text in the window that has a line ending in the word buffer follwed by a full stop (or any other full stop in the WordBreak formatted text will do). Now resize the window until the full stop appears on the next line. The same thing happens with other punctuation.
The correct behaviour would be for breaks only to ocurr at whitespace.
I'm hoping this will be fixed in a future release.