When I try to replace a muiltipatch model in ArcScene with COLLADA (27 MB), it takes forever still not to finish. The model in DAE attatched for reference (Attachment #1 is the overview of the model; #2 is main part of the model)...
I would recommend creating a Support incident to discuss it or try it on a different machine. Most of the limitations I have seen with that process have involved the combination of video card/memory/size of display.
I would also try splitting the model into its two parts so that their reference points are close to the actual models themselves. Problems can arise when the reference point/placement point is a long way away from the model.
ON ESRI support cases �??AR304 & AR305�?? (that is, the function limitations �??import, place, replace�?? via COLLADA from �??engineering 3D PLANT models and subsurface 3D geomodels in petroleum, mining and geology), it has been logged as bugs (in ArcScene, ArcGlobe) and requested to keep investigating.