I tried to create two contour lines with a relatively small difference (0.5meter) on a DEM dataset. For example, I created an 8-meter contour(the red one) and then created an 8.5-meter(the blue one) contour. Their shapefiles overlapped with each other at the place which should be the position of 8-meter contour. What's weirder is that I cannot select the 8.5-meter shapefile while I can select an invisible line of 8.5-meter beside its shapefile (highlighted blue line).
Here's the code I used to create these contours, I set the interval as 200 so it will only draw one line:
import arcpy
from arcpy import env
env.workspace = "D:\Arc GIS\"
arcpy.Contour_3d("Dem.tif","D:\Arc GIS\Dem,-8.shp", 200, -8)
arcpy.Contour_3d("Dem.tif","D:\Arc GIS\Dem,-8.5.shp",200, -8.5)