What else is configured from the sourcetype you're assigning it? Did you restart Splunkd after modifying the sourcetype? line breaking is one of those things that needs a restart
Something else to check, do you have a distributed deployment? Where did you apply the props.conf changes? Line breaking should be performed on the system that you are running DB connect on (expecting DB Connect is on a search head) assuming you are sending 'cooked' data to the indexer, which is the default for tcpout (in outputs.conf). If it is not sending cooked data, then linebreaking will need to be done at the indexer.
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