This is what TJ LInden reported back:
"This is a known issue our developers are working on (BUG-772), and is caused by the region's physics memory becoming full. You can view the physics memory usage by going to the Statistics window (Ctrl-Shift-1) and opening Physics Details (it is shown as Memory Allocated). If this value reaches about 920 MB for a full region or 230 MB for a homestead or openspace region, the physics engine will no longer be able to calculate boundaries properly, and no objects will be rezzed. Our engineers are working to correct this; in the meantime, if the physics memory starts approaching these values, restart the region to clear it and the region should work normally."