The "Improve diff compare screen" proposal is in the Wishlist Survey top 10. The proposal leaves a lot of open space. Investigate and discuss definition of the problem, and proposed solutions.
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Original proposal: Don't you just love diffs like this one. It must be possible to improve this diffcompare-view. For inspiration you can look at the wikEdDiff gadget. The Quixotic Potato (talk) 06:41, 29 September 2015 (UTC)
[Combined from separate proposal:] When someone moves a paragraph and then edits it, this edit is not shown separately by the "Difference between revisions" functionality. This problem also occurs when someone inserts a blank line above a paragraph and then edits it. Thanks, --Gnom (talk) 10:12, 12 November 2015 (UTC)
Community Tech preliminary assessment:
Support: Very high. There was unanimous support on the survey, although a couple of people wondered if this was too big for our team to handle. (They might be right, we'll see.) That being said -- the proposal itself was very vague, and there are a lot of different ways to define what needs to be improved.
Impact: Potentially high. This tool is commonly used by editors, and improvements could help many people’s workflows. However, the actual impact won't be clear until there's a concrete proposal.
Feasibility: TBD. We need to analyze what works in current diffs, and what the problems are that people would like us to solve. Some improvements may be easy while others would be major projects.
Risk: High. This wish is not well scoped yet, and there are no firm acceptance criteria. This will need considerable research/design research work, and the CT team does not have these capabilities. Changes to the diff page will also require significant community discussion to approve changes.
Status: We really want to work on this. It's a huge, important problem, and there's no other current WMF team that would take this on. We'll have to really dive into defining the problem, including lots of input from active contributors. Wikimedia Deutschland's TCB team also has "Show changes to the section text in a move" on their list. (link in German) We can work together. We'll focus on this in the spring.