I too get this problem when performing linear measurement. It is consistently about 40% too high. When measuring a section line, for example, it measures at 1.4 miles instead of 1 mile. I am running ArcGIS 10.1 and this has been happening for all iterations of version 10. Any help would be appreciated.
Never mind, I got stupid and forgot to measure Geodesic instead of planar. Ignore the little man behind the curtain...