The collision boxes not matching is something that is a bug and I believe currently has an issue on github.
The word wrap is because all text objects auto fit to the rendered text by default. To modify the word wrap you need to set your text object to a fixed size (the largest you want it to be) by selecting the custom size checkbox or dragging the corners in the scene editor.
Once the custom size is set, word wrapping will adjust to whatever you set it to, so long as it is smaller than the custom size.
I’ve tested and confirmed this is true for all text object types (text, bbtext, bitmap text)