awk '
/^[[:space:]]*$/ {if (line) print line; line=""; next}
{line=line $0}
END {if (line) print line}
'
perl -00 -pe 's/\n//g; $_.="\n"'
For multiple files:
# adjust your glob pattern to suit,
# don't be shy to ask for assistance
for file in */*.txt; do
newfile="/some/directory/$(basename "$file")"
perl -00 -pe 's/\n//g; $_.="\n"' "$file" > "$newfile"
done