Emacs insert-buffer ignores line breaks?

I'm having trouble inserting a buffer in Emacs. Say I have the following two files:

file1.txt

1st line

file2.txt

2nd line
3rd line

If I open file1.txt in Emacs and then insert file2.txt with C-x 开发者_运维问答C-i, the result is

1st line
2nd line 3rd line

and not

1st line
2nd line
3rd line

Am I missing something here? I'm running GNU Emacs 23.2.1 on Windows 7. Both files are in the default utf-8-dos encoding.

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Found the problem. I have longlines-mode enabled for text files. If I disable it, or better yet switch to visual-line-mode, the file is inserted as expected.