I've also experienced this. Its reproducible by riding a fast horse, using a boat, or sprinting.
It seems to be that you become stuck and de-synced in a way. When there are 2 people on the server, only 1 will be effected at a time. Monsters in the chunk will continue to work, but will become invisible if they cross the barrier.
It also appears as if things "vibrate" at the border between the glitched chunk and a working one.
Logging out and logging back in fixes the issue temporarily.
Jefferey O
I've also experienced this. Its reproducible by riding a fast horse, using a boat, or sprinting.
It seems to be that you become stuck and de-synced in a way. When there are 2 people on the server, only 1 will be effected at a time. Monsters in the chunk will continue to work, but will become invisible if they cross the barrier.
It also appears as if things "vibrate" at the border between the glitched chunk and a working one.
Logging out and logging back in fixes the issue temporarily.