Control-D in grep output

[Perry Smith]

I am running emacs 22.1.1 on AIX 5.3.  When I do "grep" from inside  
emacs the very first line has an extra ^D (control-D, one character).

I've moved my .kshrc, .profile, .bashrc, and .bash_profile files off  
to the side thinking that they somehow were introducing the problem  
but that does not make a difference.

I set debug-on-entry on compilation-start.  When I step through it via  
the debugger, if I step through it slowly, I do not have the issue.   
If I just step a few steps in and then hit continue, I have the problem.

Anyone have some suggestions of what this could be or how to debug it?

Thank you,
Perry