Also unsure if I should mark 1.8pre4 as affected version since while it does occur, i haven't tested on a 1.8pre4 generated map, only a 1.8 generated map
Alright seems it's not even aligned to chunk boundaries, just area's on the map. Filled the problematic chunk with bedrock so it couldn't be entered, and just getting near it in a different chunk (about 5 blocks from the boundary) still crashed.
is from the adjacent chunks crash after getting halfway into the boundary.
Manually regenerated the chunks while server was offline (unfortunately was using the MC1.5.2 jar for generation), but still crashed in the same fashion.
Starting to suspect it's not the chunk itself (since it used to be fine but regenerating it breaks) but something else.
Completely deleting a player file and running back to the chunk location also makes no difference, it is not unique to a player, but to the chunk location.
Deleting the chunk and nearby chunk with MCEdit and regenerating them does not resolve the issue, same method of crash when entering the problematic chunk
Looks like it's a lot more than just chunks, or it's spreading. Pretty much anywhere past the Z axis of the original problem within 200 blocks on the X axis will crash the server now. Many dozens of chunks worth of space would be affected.
I did test on jdk7 as well with no change.