Here is a line of code

Here is a couple of lines of code
see here is the second line

However, if you have a space on the empty line, the blank formatting is kept:

Here is the first line of code
 
Here is the second line

If you start a code block, and then paste in the code, the blank lines are retained as well, but don't try and re-edit it.

#!/bin/bash
if [ -f "/Library/Internet Plug-Ins/JavaAppletPlugin.plugin/Contents/Enabled.plist" ] ; then VERSION=$( defaults read "/Library/Internet Plug-Ins/JavaAppletPlugin.plugin/Contents/Enabled.plist" CFBundleVersion )
else
   VERSION="Not installed."
fi
echo "$VERSION"

Adding new lines will break up the code blocks.

#!/bin/bash
if [ -f "/Library/Internet Plug-Ins/JavaAppletPlugin.plugin/Contents/Enabled.plist" ] ; then VERSION=$( defaults read "/Library/Internet Plug-Ins/JavaAppletPlugin.plugin/Contents/Enabled.plist" CFBundleVersion )
else
   VERSION="Not installed."
fi

echo "$VERSION"

To avoid breaking the code into separate blocks, select the whole block, change it back to the Normal Style, then edit it. When you have it edited, select the whole block and convert it back to Code.

Notice also that you can have several nested layers of code blocks:

Outer code block
Inner code block
Inner Inner code
Outer code