Stop looking at me 🙂
Unfortunately I can't provide you with a solution. This is due to a bug, errr limitation in Silverlight that prevents you from stretching elements to the extreme, (basically when it exceeds 32768 pixels wide/tall, it overflows and starts the weird flashing). We have filed this bug to the Silverlight team, but the response is basically that they don't think it's possible to fix due to some very low-level things going on on the graphics card, so don't expect this to be fixed in a future version either.
We have overcome this in the graphics layer by clipping the geometry on the fly when hitting that limit, but there's no way to prevent this on an element layer, other than to tell you not to zoom that far in (in most cases I would argue that zooming that much in on a single element would stretch it so much it doesn't make sense to look at it anyway though :-).
In most cases you can actually accomplish the same with a GraphicsLayer as with an ElementLayer by using custom symbols. Have you considered this? GraphicsLayer has many benefits over ElementLayer (better performance, the mentioned clipping, wrap-around support etc)