I know this is a very late response but it might help people still encountering this problem. I think it has something to do with how SL calculates the vertex information when formulating the LODs. When I change the numbers in the LOD boxes in the uploader, it can clear up the problem. Try that. If you are dealing with rigged mesh, you can throw your mid and lowest LODs to zero and it won't affect how the mesh looks when worn.