This is the new release, correct? If yes, then the links are in functions.php. Look at the getlinks() function, mainly this line:
PHP Code:
$links = $links."<li><a href='".$linkurl."'>".$linktext."</a></li>";
To remove the line breaks, replace with:
PHP Code:
$links = $links."<a href='".$linkurl."'>".$linktext."</a>";
:)
Brandon