I'd argue that what you want to do is write English language as you're accustomed. Paragraphs with multiple sentence in a single line.

What you'd like Git (or whatever your diff'ing program) to do is parse the individual sentences as individual lines for version control.

To each his own though. I have trained myself to start putting LaTeX sentences on separate lines to accomodate for this, but don't think that this is the best solution.