Barry then asked in the Groups thread yesterday if there was any resolution to it and Susan replied:
It was an issue on our end, and should be cleared up now. Thanks for
all your reports!
If anyone is still seeing DNS-related errors in their Webmaster Tools
account, check the "last found" date. If it's dated before today, wait
for us to recrawl the URL and the error should go away; otherwise,
feel free to post the details here and we can look into it further.
Indeed, the one site that had the problem that I had access to, did get the problem resolved, and did get its rankings back. The Webmaster Tools still has some lingering issues with not showing everything as being ok, but it is obvious that it's been worked out because the Tools show that the home page has been successfully indexed recently. Before, it showed an old index date. We all know that Tools can take a while to update itself, so I'm not worried about still seeing it show DNS URL timeout issues. Obviously, it would be nice if changes propagated through the Tools console faster, but as long as the problem is actually fixed, and it seems to be, I can patiently wait for the fixes to be reflected in the console.
Thanks Google for looking into the issue, finding the problem, admitting it WAS a problem on your end, and fixing it. Very nice.