I'm currently facing multiple highly blocking issues with the Rich Text field. For some of them I'm not sure if it is the expected behavior or a bug, but hope someone can help me solving those issues:
I can't have different headings, the option always apply to all the content
I can't have a paragraph and a list, the list option always apply to all the content, so everything is put in a list
I can't add an image, the option seems to do nothing
I can't add an embed, the option seems to do nothing
I made a screen record for a better comprehension of the issue. (Same behavior if using RichText within a slice)
Thanks for posting this question. I think the problem is that you have unchecked "Allow multiple paragraphs" in the Rich Text field configuration.
Then, I would guess that in the text editor, you're using a line feed (shift + enter) instead of a carriage return (enter) to create a line break. A line feed doesn't create a new paragraph; it creates a line break within the same paragraph, so the styles are applied to everything.
Regarding the error with embeds and images, I would guess that they only work with "Allow multiple paragraphs," but I'd have to check with our product team. I'll get back to you on that
I hope this helps. Let me know if enabling "multiple paragraphs" changes things.