Okay so since resolvconf and dmasq are not cooperating, I have resorted to 
using dnscrypt-proxy. Credit to QkiZ, the dnscrypt-proxy service works EVERY 
TIME and ignores the (completely broken) DNS resolution of dnsmasq and 
resolvconf. Even with the newest version of network-manager (1.2.6) on 16.04 
LTS and all its dependencies:
 network-manager
 libnm-glib-vpn1
 libnm-glib4
 libnm0
 libnm-util2
No more DNS resolution issues!
To apply this workaround (which actually also offers some security benefits 
against DNS leakage), use:
sudo apt install dnscrypt-proxy
In the network manager, select "Edit Connections", select the primary (non-VPN) 
network you use, click on the "IPv4 Settings" tab, change the "Method" tab to 
"Automatic (DHCP) addresses only", then add 127.0.0.2 to the "DNS servers:" 
box. Save your changes, then restart the connection by disabling and enabling 
networking. Now go to https://www.opendns.com/welcome/ and you should see a 
nice check mark.
Now, your network connection and VPN should work (meaning DNS resolution won't 
break on you) every single time you wake up from suspend or use 
sudo service network-manager restart
And if for some odd reason it's slow just restart the network manager 
repeatedly by aliasing that to something like 
alias nm-restart='sudo service network-manager restart' 
in your ~/.bash_aliases file. I know, annoying but at least DNS resolution 
actually works and the computer doesn't have to be literally restarted to 
connect to the internet. 
This isn't intended to be a fix, just a possible alternative for those of us 
who experience total DNS resolution failure using a vpn on Ubuntu.

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You received this bug notification because you are a member of Ubuntu
Touch seeded packages, which is subscribed to resolvconf in Ubuntu.
https://bugs.launchpad.net/bugs/1671606

Title:
  DNS server from vpn connection is not being used after network-manager
  upgrade to 1.2.6-0ubuntu0.16.04.1

Status in network-manager package in Ubuntu:
  Confirmed
Status in resolvconf package in Ubuntu:
  Invalid

Bug description:
  I use my company's cisco vpn via network-manager in Ubuntu 16.04.2
  LTS. After recent upgrade of network-manager:amd64 from version
  1.2.2-0ubuntu0.16.04.4 to version 1.2.6-0ubuntu0.16.04.1 DNS
  resolution of VPN's server hostnames does not work. Roll back to
  version 1.2.2-0ubuntu0.16.04.4 solves the problem.

  Steps for reproducing:
  1. upgrade network-manager:amd64 from version 1.2.2-0ubuntu0.16.04.4 to 
version 1.2.6-0ubuntu0.16.04.1
  2. connect to VPN via network-manager applet
  3. nslookop servername.internal --> ** server can't find servername.internal: 
NXDOMAIN
  4. disconnect from VPN via network-manager applet
  5. roll back network-manager via command: sudo apt-get install 
network-manager=1.2.2-0ubuntu0.16.04.4
  6. restart network-manager via sudo service network-manager restart
  7. connect to VPN via network-manager applet
  8. nslookop servername.internal --> the server is resolved correctly

  ProblemType: Bug
  DistroRelease: Ubuntu 16.04
  Package: network-manager 1.2.6-0ubuntu0.16.04.1
  ProcVersionSignature: Ubuntu 4.4.0-66.87-generic 4.4.44
  Uname: Linux 4.4.0-66-generic x86_64
  ApportVersion: 2.20.1-0ubuntu2.5
  Architecture: amd64
  CurrentDesktop: Unity
  Date: Thu Mar  9 19:49:55 2017
  InstallationDate: Installed on 2015-10-05 (520 days ago)
  InstallationMedia: Ubuntu 15.04 "Vivid Vervet" - Release amd64 (20150422)
  NetworkManager.state:
   [main]
   NetworkingEnabled=true
   WirelessEnabled=true
   WWANEnabled=true
   WimaxEnabled=true
  SourcePackage: network-manager
  UpgradeStatus: No upgrade log present (probably fresh install)
  nmcli-nm:
   RUNNING  VERSION  STATE      STARTUP  CONNECTIVITY  NETWORKING  WIFI-HW  
WIFI     WWAN-HW  WWAN
   running  1.2.6    connected  started  full          enabled     enabled  
enabled  enabled  enabled

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https://bugs.launchpad.net/ubuntu/+source/network-manager/+bug/1671606/+subscriptions

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