Hi @Amanda Mason, your screenshot shows an portfolio level work item, so the configuration you mentioned will not affect this. The "Rich text formatting" settings define how data coming from Jira (Stories, Epics) are handled in Jira Align description and acceptance criteria fields. With your setting ("Jira rendered field") you should be able to use a little "eye" icon showing up next to a story or feature description field. A click on it will show the description as it is rendered in Jira.
Looking to the Epic level: there are several feature toggles, that influence the formatting possibilities in Jira Align. There is also a little SCEditor that could be enabled. The best way is to contact your Atlassian Solution Architect or open a service ticket to get clarity about your options.
Finally, looking to the status report I assume that a change of the description field display will not have an effect on the report. My assumption for the report is: the field content is shrinked as the main information here is not the description field (which might be long and distracting) and the report wants to keep focus on the information below that field. I understand your point, and a feature request might also be an option to get this report behaviour changed.
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