running sed is not doing it manually. Doing it manually would mean change every space by hand - line by line 
Sed/awk/tr can be used on windows. I know that, because I used them myself.
Otherwise you should be able to use any text-editor w/ replace feature (not recommended because slow).
Maybe also a simple cmd batch script with file reading (for loop) + replace should work.
It's very clear why hashcat uses newlines as word-terminator... and it is kind of a good choice, but of course any choice can't fit to all use-cases (like yours).
Many passwords (including passphrases) contain spaces, therefore using spaces as plain-terminator would be a bad choice.
Anyway, I am not sure if you really find a lot of wordlist with 1 line only (that doesn't make sense at all).
Maybe you just use the *wrong* text-editor to display them (see windows vs unix line-terminators \r\n vs \n)
Notepad++ could be kind of a good choice for a modern text-editor in windows (also if I prefer others - vim, gvim etc).
Sed/awk/tr can be used on windows. I know that, because I used them myself.
Otherwise you should be able to use any text-editor w/ replace feature (not recommended because slow).
Maybe also a simple cmd batch script with file reading (for loop) + replace should work.
It's very clear why hashcat uses newlines as word-terminator... and it is kind of a good choice, but of course any choice can't fit to all use-cases (like yours).
Many passwords (including passphrases) contain spaces, therefore using spaces as plain-terminator would be a bad choice.
Anyway, I am not sure if you really find a lot of wordlist with 1 line only (that doesn't make sense at all).
Maybe you just use the *wrong* text-editor to display them (see windows vs unix line-terminators \r\n vs \n)
Notepad++ could be kind of a good choice for a modern text-editor in windows (also if I prefer others - vim, gvim etc).