The double spacing in the Address Block probably occurs because you, like me
have the normal paragraph style formatted to have a space before or after
it.

I would suggest that you do not use the Address Block, but instead, just
insert the required merge fields in the configuration that you want them.
Then you can choose to have all of the components of the address in a single
paragraph with a new line separating each of them rather than eich item
being in its own paragraph.