I opened my DGN file in ArcMap 10 sp2. It does not have a Coordinate system defined. It seems to move the data a couple feet in both x and y. I only have the CAD files and survey points in the same custom projection opened in ArcMap. The attached pic shows the CAD and survey points I added to ArcMap. The triangles should overlay the circles that are numbered. With the Dataframe properties Coordinate System set to Unkown I would think that Arcmap would just display the CAD file without trying to project it. Any ideas??
PS when I open it in Microstation it shows the points in the correct place.