Thunderbird does not wrap text in 14.04

There is a place it can be set although I don't know why it would have been changed on you.

From the Thunderbird Menu, choose Edit->Preferences->Advanced->General->Config Editor

In the Config Editor, enter 'wrap' as a search term

I've enclosed a screenshot of my settings for this, which work and have not been changed that I know of.

I don't think toggle wrap is an option in Thunderbird. Thee is however an extension, called Toggle Word Wrap:

Checking "Enable Word Wrap" will enable word wrapping again and set it to the standard width (which is modifiable through the "mailnews.wraplength" preference in the Config Editor, the default is 72 characters).

You can also disable it whenever you want, however I believe that is only temporary.

You can get it from the Addons site.