This came up a few weeks back, but I quickly lost the conversation.
Shouldn't the quotation environment work as it does in LaTeX? If one has a \startquotation after a paragraph break (white space, or \par) and a break after the \stopquotation, then the following paragraph should understood to be new, and hence requiring a first line indent.
If, however, there are no breaks, then the quote is understood to be a part of the larger paragraph on either side of it, and hence the text after block quote is not indented. (And might this be default behavior? Relevant, say, if typesetting a DocBook doc with its blockquote element.)
Seems to me this is easier and more elegant than specifying some option every time one wants to use the command...