It seems the entity relation/link system has been changed completely, which means there may be a chance that the bug is gone simply because the system that made it happen doesn't exist anymore.
I did some looking into how cascades happen a while back, and I must say I think this may be the case. The old one had a very one-off "You attacked, you are now an enemy of all my entity", and since fort-mode dwarves are part of two distinct entities (civ and site governments), one of which they revoked by attacking a guard, they became conflicted: an enemy to their civ, but since they were also loyal to fort, an attack on one of them by a fort dwarf would revoke one of the fort dwarf's loyalties and make him conflicted ,although in the opposite way to the attacked dwarf, and this could continue on and on.
If fort-civ governments were made more closely related, if entity x-on-entity x violence was significantly changed (which it was), and if loyalties were made less absolute (which they were), there could possibly be a fix not of Toady's intention in there.
Anyway, with religious conflicts coming up,
Will we be able to worship a god, and if so will people react to us differently because of it? I would think not, but it would make sense in the current work.