It was general labels I was using, but the same thing happens with parcel labels
I think I have resolved the problem: if lines and arcs are drawn then converted to a pline, the labeling will usually work. However if "Rpoly" is used to reverse the pline direction or if the pline is exploded, a corner re-filleted then changed back to a pline and re-labeled the numbering sometimes goes wonky.
Just thinking out loud on the topic of labels, when circles are selected for the border around labels why does C3D not allow for a fixed radius to be selected rather than border offset? This results in various sized circles around the tags. To get around this I use a block.