Newline Handling of [Microsoft.PowerShell.PSConsoleReadLine]::Insert broken in Windows

Prerequisites

[X] Write a descriptive title.
[X] Make sure you are able to repro it on the latest released version
[X] Search the existing issues, especially the pinned issues.

Exception report

N/A

Screenshot

Environment data

PS Version: 7.3.11 and 7.4
PS HostName: ConsoleHost
PSReadLine Version: 2.3.4
PSReadLine EditMode: Windows
OS: 10.0.19041.1682 (WinBuild.160101.0800)
BufferWidth: 120
BufferHeight: 9001

Steps to reproduce

I've developed a module (CmdFav) which inserts commands into the NEXT prompt. If the command is a multiline command the command string is internally build with StringBuilder.AppendLine(). StringBuilder is using Windows' carriage return + new line (`r`n) instead of just new line (`n). This causes PSConsoleReadLine::Insert to insert visible ^M characters (orange arrow in screenshot) and moves the cursor additional lines to low (red marker in screenshot).

Code to reproduce:

$sb=[System.Text.StringBuilder]::new()
[void]$sb.AppendLine('write-host "Hello"').AppendLine('write-host "World"')
$global:Suggestion = $sb.ToString()
$global:InjectCommand = Register-EngineEvent -SourceIdentifier PowerShell.OnIdle {
    [Microsoft.PowerShell.PSConsoleReadLine]::Insert($global:Suggestion)
    Stop-Job $global:InjectCommand
}

The 'too low cursor' prevents the user to modify the code which is inserted into the prompt in the blank space. If I move the cursor into the blank space and (e.g.) press + the real code is shown, interrupted by the + char.

Expected behavior

No ^M visible
No blank lines
Inserted code should be editable in the right space

Actual behavior

Multiline text is postfixed with a ^M
After the inserted text additional blank lines are inserted, the cursor is not at the right spot
The effective inserted text is hidden in the blank lines and has to be edited there instead in the directly visible part

I do think PSReadLIne should probably convert `r`n to `n when it's passed to Insert

The offset problem only manifests when it's being called like this in the OnIdle.

Compare these:

$global:HistoricalLines = (Get-History -Count 3).CommandLine -join "`n"

function Add-History {
  $global:InjectCommand = Register-EngineEvent -SourceIdentifier PowerShell.OnIdle {
      [Microsoft.PowerShell.PSConsoleReadLine]::Insert($HistoricalLines )
      Stop-Job $global:InjectCommand
  }
}

Set-PSReadLineKeyHandler -Key Alt+h -ScriptBlock {
    [Microsoft.PowerShell.PSConsoleReadLine]::Insert($HistoricalLines)
}

The key handler works exactly how I expected it to, but the OnIdle handler ends up offset by ... however lines there were in the combined history.

PowerShell / PSReadLine