Never seen that kind behaviour with xline unless ORTHO was turned on, which would then of course be constrained to H or V.
Check that nobody has messed about and defined 'XL' in your CUI to to a macro that looks like XLINE but has a hidden 'h' in there to mess you up, (some people think this kind of thing is funny).
If not then yes it looks like a bug.
ARMAGEDDON - If you can't spell it it's not the end of the world.
Im intelligent enough to know that I dont know everything; but I'll tell you all about it anyway.