Many glitches while mining in deep caves on Live multiplayer. Blocks do not break when mined, do not drop mined material, and reappear while occupying the same space as player leading to suffocation and loss of mined material. Also cannot place lights, evil mobs glitch and disappear while fighting leading to being attacked by invisible mobs. 

all glitches occurred after recent Cliffs and Caves Update II on an existing world under previously loaded area of map.