Was this perhaps inserted from a pre 2006 drawing, block or xref? It looks like the insunits bug again to me. I just started using 2006 for production and am fighting similar things whenever I start up, insert or xref any older file. I am hearing the preferred solution is to set all of the variables to "2" and most problems will go away UNLESS you use LDT 2006 which will kindly reset the values every time you insert something.
Here is a quote from the latest suggestion in this topic from the Autodesk LDT Newsgroup:
" . . . setting INSUNITS=2, INSUNITSDEFSOURCE=2, and INSUNITSDEFTARGET=2 and I've gotten decent results. When all 3 variables are set to 2, some older symbols still come in improperly scaled (by a factor of 12), but almost all of the xrefs are working fine . . . "
the
WHOLE THREAD is full of symptoms of the bug and various solutions that have been tried to patch up autodesk's mess.