Thank you @rwoolhou.

I have selected body_surface-interior. I'll try to deselect it and see what happens.

For now - if anybody has the same issue - I've managed to by pass the issue by reducing spatial step so that my mesh lines visually merged (I reduced it from 1mm to 0.2mm). It increased the time of simulation (which I tried to avoid) but gave me more accurate results (which I didn't need though - but the results were definitely more appropriate).