I have two separate CAD files of the same locale. The first one has surface data like street curbs, building footprints, etc. It is not georeferenced, but when I add it to other items in a projected (NAD 1983 FIPS US feet Connecticut) data frame, it aligns perfectly.
The other CAD file contains subsurface utilities and a surface basemap as a reference. When I try adding them, they show up very very small not too far from the properly projected data.
When I try to project subsurface layers, they don't show up at all.
Trying to georeference manually gives me an error after I manually attempt to enlarge it using georef toolbar tools, even if I delete the spatial index.
I have ArcGIS 10.1 SP1 and a trial of CAD 2014.
Screenshot displays properties boxes, the surface data on the right, subsurface on the left.