I also wonder if this is some sort of infection... some strange process
hijacking DNS.

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https://bugs.launchpad.net/bugs/963943

Title:
  nm overrides LAN dns settings: host lookups on LAN fail.

Status in “network-manager” package in Ubuntu:
  New

Bug description:
  There is a local network, with two DNS servers, and a DHCP server.
  They are both correctly configured and entirely functional, with
  correct zoning (bind9) for split-horizon DNS. This has been a working
  configuration for years.  DHCP is configured so that clients use these
  internal DNS  servers.

  There is no configuration in /etc/network/interfaces, so this is
  entirely run by network-manager.   When the wireless configuration
  comes up, rather than pointing at the LAN dns servers, it points at
  127.0.0.1.   I can identify no process providing the caching servics,
  ps -ax | grep  ns, name, bind,  all come up empty.  Whatever is doing
  name resolution, it is not using the LAN's DNS servers, because none
  of the internal zone entries are available.  While public name
  resolution works,  ssh to other systems on the LAN fail because the
  internal zone host names are never found.

  If I manually place the local dns servers in /etc/resolv.conf,
  everything works fine for a few minutes, when something overwrites it
  back to 127.0.0.1

  ProblemType: Bug
  DistroRelease: Ubuntu 12.04
  Package: network-manager 0.9.3.995+git201203152001.04b2a74-0ubuntu1
  ProcVersionSignature: Ubuntu 3.2.0-18.29-generic 3.2.9
  Uname: Linux 3.2.0-18-generic x86_64
  ApportVersion: 1.95-0ubuntu1
  Architecture: amd64
  Date: Sat Mar 24 09:55:26 2012
  IfupdownConfig:
   auto lo
   iface lo inet loopback
  InstallationMedia: Ubuntu 12.04 LTS "Precise Pangolin" - Beta amd64 (20120301)
  NetworkManager.state:
   [main]
   NetworkingEnabled=true
   WirelessEnabled=true
   WWANEnabled=true
   WimaxEnabled=true
  ProcEnviron:
   LANGUAGE=en_CA:en
   TERM=xterm
   PATH=(custom, user)
   LANG=en_CA.UTF-8
   SHELL=/bin/bash
  SourcePackage: network-manager
  UpgradeStatus: No upgrade log present (probably fresh install)

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