21.4.13: ^c in shell now works, but now shell output only shows up when cursor moves

I have 21.4.13 set up on one box, and I'm setting up 21.4.13 on another box, and copying over elements of the "init.el" from the first box. One annoyance I've had for a long time in shell mode is that ^c while running an app in shell mode does not kill the app. I've tried to find a solution to this for a long time, to no avail. I've just gotten used to it. When I set up 21.4.13 on this new box, I got to a point where I realized that ^c was killing the app. This was nice to see. However, now I see that apps that produce somewhat long-running output are only producing blocks of output, only when I move the cursor. On the old laptop (where ^c doesn't work), the output comes out normally. Are these two issues related? I'm not sure which problem is more annoying. Is there something I can do to fix the "blocky output" problem?