Bug in plotting dashed lines with outlier?

Running : OS X 10.3.9 - matplotlib 0.86 (Agg backend) python 2.3 Numeric 23.7

I have the following command sequence:

import Numeric
N = Numeric
from matplotlib import pylab
PL = pylab

x = N.arange(10.)
y = N.arange(10.)
y[-1] = 1.0e18

PL.xlim( 0.,7.)
PL.ylim( 0.,7.)

PL.xlim( 0.,7.)
PL.ylim( 0.,7.)

Note that the y array has a screwy point - 1.0e18.
What happens is that the first plot ('plot1') looks fine but the code hangs on the savefig for the second plot - apparently nothing useful is happening - it just hangs.
if I change the upper limits to 9 for plot 1, you can see a red filled polygon being drawn on the right hand side of the figure - do not know why ? With the limits of 7 all the nasty bits are not seen.
I suspect that the dashed option tries to produce a plot with a huge number of line segments and the code is overwhelmed - I am OK with overwhelmed but not with the code hanging. Something a bit more graceful should be done if possible.
Is there any thing I can check to avoid this situation?
In the actual case in which this occurred I tried to produce a plot after a lengthy computation. The computation had an outlier, It was a bit annoying to have the plot hang and thus I lost all the results to that point.

I could swear that this used to work(produce a plot in the second case) in an earlier version of matplotlib. I had actually performed the computation and plot before and all went OK. I have the printed copy before me.

Thanks for any help.