Hi Kasha -
We need to make this more clear, but the best way to delete the extra line after the holiday shipping message is to select "Delete" from the bulk edit dropdown, type the holiday shipping message, and then hit the "Enter" key to include the extra space as well.
Once you click "Apply" you'll be able to see if the extra space was deleted and if so, just click "Sync Updates" to send the updates to Etsy.
Hopefully, this makes sense, but if you have any questions please don't hesitate to reach out.
Thanks,
Justin