My experience has led me to believe it is almost impossible to bake bread in a bread machine that is light and fluffy. However, as stated in an earlier post, the key seems to be in allowing the dough to rise outside the machine and for at least one extra rise. Also, use Crisco instead of any bottled oil and use whole milk (when milk is called for) instead of reduced fat.

This does seem to make mine much lighter. However, for very light bread I only use the machine to do the hard work, the kneading. I let the dough rise in a bowl covered with a damp towel and bake in a traditional bread pan. I have come to the unproven belief that the close confines of a bread maker and the limited surface area exposed in the bread maker pan inhibit the yeast from working to it's full potential. It's also possible that since most bread makers make loaves that are higher than they are wide it compacts the dough and doesn't allow it to fully rise.