Uma abordagem dupla do awk:
$ awk '{printf("%s",$0 (NR%5==0?ORS:":"))}' file1 |awk -F':' '{print $1,$2;print $3,$4,$5}'
1 2
3 4 5
6 7
8 9 10
As linhas são unidas pela primeira vez em grupos de cinco, cada linha associada ao símbolo :
.
O trabalho da solução, mesmo que as linhas contenham mais palavras
$ cat file2
this is line 1
this is line 2
this is line 3
this is line 4
this is line 5
this is line 6
this is line 7
this is line 8
this is line 9
this is line 10
$ awk '{printf("%s",$0 (NR%5==0?ORS:":"))}' file2 |awk -F':' '{print $1,$2;print $3,$4,$5}'
this is line 1 this is line 2
this is line 3 this is line 4 this is line 5
this is line 6 this is line 7
this is line 8 this is line 9 this is line 10