When grub-mkconfig is called for a grub installation on a multi-device btrfs volume, the function prepare_grub_to_access_device() is called from the /usr/share/grub/grub-mkconfig_lib bash library, which has this block of code in it:

if fs_uuid="`"${grub_probe}" --device "$@" --target=fs_uuid 2> /dev/null`" ; then
hints="`"${grub_probe}" --device "$@" --target=hints_string 2> /dev/null`" || hints=
echo "if [ x\$feature_platform_search_hint = xy ]; then"
echo " search --no-floppy --fs-uuid --set=root ${hints} ${fs_uuid}"
echo "else"
echo " search --no-floppy --fs-uuid --set=root ${fs_uuid}"
echo "fi"
fi

The ${grub_probe} call with --target=hints_string will return multiple lines of output when --device refers to more than one device, which is the case for multi-device btrfs volumes (and probably others). Normally, the newlines would be converted to space-separated fields via the default IFS, but because the echo lines put double-quotes around ${hints}, the newline separators are preserved, resulting in a completely broken "search" line output in grub.cfg.

It seems that the search and its hints isn't strictly necessary as I haven't seen any configuration fail to boot without it, but this is a fairly simple bug to fix so I figured I should follow up on it.

This is not an Arch-specific bug, as the exact same code is present in the current trunk repo on savannah.gnu.org for grub. I plan on making the same bug-report there, but my experience with savannah (and looking at the bugs in the grub tracker in particular) is that it's unlikely to get fixed soon, if ever, so it might be worth Arch carrying a simple patch.