Quotes are always preceeded by one line of white space within the quote box.

This seems at least partially because the board insists on putting a line break right after the opening quote-tag (I've tried removing the line break, but the white space will still be there and when I go and edit the post, the line break will be back too).

Although the behaviour of re-entering the line-break may be a little confusing (this issue exists with 2.0 as well and I have become used to starting a quote directly after the opening text), I think a more robust behaviour would be to strip white space from the start and end of a quoted text. This would ensure a consistent, tidy look of all quotes regardless of how many enters or spaces people put in them.

Alternatively, if phpBB doesn't want to take control of the formatting in the proposed way, it should simply stop adding that line break after the opening tag, when post-processing a post, but also when "automatically" adding a quote by clicking a quote button.