A variable modified inside a while loop is not remembered

Question

In the following program, if I set the variable $foo to the value 1 inside the first if statement, it works in the sense that its value is remember

Answer 1

UPDATED#2

Explanation is in Blue Moons's answer.

Alternative solutions:

Eliminate echo

while read line; do
...
done <

Add the echo inside the here-is-the-document

while read line; do
...
done <

Run echo in background:

coproc echo -e $lines
while read -u ${COPROC[0]} line; do 
...
done

Redirect to a file handle explicitly (Mind the space in < <!):

exec 3< <(echo -e  $lines)
while read -u 3 line; do
...
done

Or just redirect to the stdin:

while read line; do
...
done < <(echo -e  $lines)

And one for chepner (eliminating echo):

arr=("first line" "second line" "third line");
for((i=0;i<${#arr[*]};++i)) { line=${arr[i]}; 
...
}

Variable $lines can be converted to an array without starting a new sub-shell. The characters \ and n has to be converted to some character (e.g. a real new line character) and use the IFS (Internal Field Separator) variable to split the string into array elements. This can be done like:

lines="first line\nsecond line\nthird line"
echo "$lines"
OIFS="$IFS"
IFS=$'\n' arr=(${lines//\\n/$'\n'}) # Conversion
IFS="$OIFS"
echo "${arr[@]}", Length: ${#arr[*]}
set|grep ^arr

Result is

first line\nsecond line\nthird line
first line second line third line, Length: 3
arr=([0]="first line" [1]="second line" [2]="third line")