No problem. If you do give it a try, please let me know if it works.
Will do. FWIW, running dscacheutil -cachedump shows that the cache size is only 19, so apparently it's only caching the most recent entries. I've been working with it while monitoring the DirectoryService CPU usage. Today, once I left it for a couple minutes, it settled down. Each time the browser loads a webapage, it spikes as before, but only for 10-15 seconds, as opposed to a second or so with a small hosts file. So it appears as though it's parsing the file each time, and 5MB is taking awhile to parse.
Contrary to the local DNS caching problem on Windows, it appears as though OSX is only caching the most recent entries, thus the dns service must parse the file each time, completely opposite of the windows local caching problem. So that's not the problem. I think the file is simply too large to deal with.
In the meantime, is there a slimmer version, with the most common entries, rather than everything?