how does wordpress read post content out of the database

I am administrating 3 WP blogs. I am also writing a front end for all of them where the latest posts from each blog posts and an admin is able to select a featured which appears in its entirety. I can grab an excerpt with no problem but when I try to display content I get unknown characters and not page breaks or paragraphs. I need to know how wordpress formats all the content that comes out of the database. What confounds me is the blog displays the content as it is typed but when I grab it for the front end portal it is unformated block text with not HTML entitys, paragraph tags or returns.