OS: Windows 7 Professional SP1
Graphics card: nvidia geforce 560ti
Broken: 2.69.1 r61064
Short description of error
Multires occasionally messes up the geometry which leads to un-fixable spikes. When you try to smooth out the problem area on one multires level, it makes it even worse on other multires levels.
Exact steps for others to reproduce the error
I'm not sure how to get a sculpt into a state where this happens. In bugReport.blend, you'll see the spikes at multires level 3 near the knees. If you try to smooth them out, you'll get different spikes on multires level 4. Trying to smooth out the problem area on level 2 makes the level 3 spikes worse.
I attempted to reproduce the bug on a simpler model in bugReport2.blend and it took a long time to get it into this state where this bug happens. I used the crease, grab, smooth, and clay strips brush a lot, scaled down the object and applied the scale (not sure if that matters), and did some more sculpting. When you smooth out the problem area on multires level 1, you get issues on higher levels.
Here's a .zip of the files mentioned above: https://dl.dropboxusercontent.com/u/17578055/multires.zip