Glad it works, pcook!
The extra line above “Character” is most likely the default top paragraph margin(Space Before) for that element. The spacing is fixed 12pt, with a 12pt “Space Before” i.e. a line. These are different for each Script scheme(Screenplay, BBC Radio Scene, Stage Play, etc.).
wow out with 37 and in with 38 
OK not sure what you mean but I can tell you the extra line is not meant to be there. Its not a spacing thing, its a whole extra line. When in screenplay mode, type a line of action. then if you hit enter twice it will bring up the menu for you to choose (scene Heading, Action, Character etc) choose character and it will place the cursor correctly with correct spacing and no extra line above. But doing it this way is insanely laborious.
Thats why the fast way to go from a line of action to character dialog is hitting enter and then hitting tab. it used to work fine but now it places a whole extra line above your character. try it and you will see.
Can anyone else try this and confirm what Im seeing (or make sense of what Im trying to explain)
I also have this same issue in the newest betas. Hitting tab to move from an ACTION element to a CHARACTER element adds an extra line break and THEN moves you to the character. Likewise for hitting tab in a DIALOGUE element to move to a PARENTHETICAL element.
It’s as though hitting tab now executes a [enter, tab] command. It’s happening to my current project and I can confirm it also happens when I open a new test project and select the screenplay template.
Should probably be a new bug. I actually came here looking to see if anyone else had posted about it yet and got sucked into reading this thread by happenstance haha.
And to your point about formatting, I agree with Simeva, you can just manage your workflow to polish it off in another program. I love Scrivener for the organizational, outlining, tagging, etc. features, when I am doing the bulk of my writing. But when I’m done (or when I want to see how long a sequence “really” is), I just compile to .rtf and then import the .rtf into Fade In. I agree that it’d be nice if we could have it all in one program, but that’s unlikely to happen, as programs like Fade In are also always advancing with screenplay-specific features and they are already ahead. At the same time, Scrivener is miles ahead of other software I’ve tried with powerful organizational features. (BTW I also use Word for my day job. Nothing wrong with having multiple tools in your utility belt.)
I was kinda hoping this minor bug would be so simple to fix it would have already been knocked on the head in B38. Of course that requires the programers trust the testers when they call out a bug and not simply say its a formating feature 
Sorry couldnt resist. Im still full of praise for the work getting it 99% functional. Dont stop now Devs!
The Tab behavior has been fixed and will be available in the next update. If this was the only bug left, it would have been fixed in Beta 38 hotfix easily.
…you do good work, Tiho.
As they say, and with tongue in cheeky cheek, 'Don’t let anyone tell you differently…;
Clive