This seems to happen to only a subset of DNN installs. When you look at a page in edit mode (not view or layout), if there is a considerable amount of extra vertical space in between the modules, here is what to do to reduce or eliminate the extra space.
Add the following class to the bottom of your skin.css style sheet.
You may have some success adding it to other style sheets instead, however it did not work for me to add it to the portal style sheet. (That is the same as the admin, site settings, stylesheet editor.)