Just did a test with a point layer using the GCS_WGS_1984 coordinate system:
These are the settings I used:
... which results in a crash:
I also used the same layer projected to Web Mercator Auxiliary Sphere.using the almost the same settings:
This time I did not generate graphics, I choose to write the features to a new featureclass in a FGDB:
and again it crashed.
Kory Kramer, I have attached the data if you want to test it yourself...