While it is not possible in winmerge, Emacs does it easily.
In 'ediff' mode you can press '#' key twice in the control panel (it is read as a command). It will ignore line break differences altogether.
Emacs is a wonderful editing environment but, unfortunately, its ediff-mode is not a very user friendly tool. The control panel is in a different window which is a bit confusing. See the final part of the youtube tutorial below for a tweak that puts the control panel in the main window.
Read more:
https://www.gnu.org/software/emacs/manual/html_mono/ediff.html