Oh hi, to start off this is like 98% due to mod compatibility. I beleave it has todo with Ars Magica.
A way to reproduce the error would be simply, to explore until you find a structure from Ars Magica.
When the chunks off in the distance are generated it causes an error like this.

[WARNING] [Minecraft] Failed to handle packet for Marcmax5 [/90.203.34.155:51550]: java.lang.RuntimeException: Already decorating!!
java.lang.RuntimeException: Already decorating!!
at zc.a(BiomeDecorator.java:195)
at yy.a(BiomeGenBase.java:366)
at abb.a(ChunkProviderGenerate.java:577)
at im.a(ChunkProviderServer.java:258)
at zz.a(Chunk.java:1258)
at im.c(ChunkProviderServer.java:153)
at il.(PlayerInstance.java:35)
at ik.a(SourceFile:172)
at ik.a(SourceFile:203)
at gm.a(ServerConfigurationManager.java:163)
at gm.c(ServerConfigurationManager.java:206)
at gm.a(ServerConfigurationManager.java:123)
at it.completeConnection(NetLoginHandler.java:195)
at cpw.mods.fml.common.network.FMLNetworkHandler.handleClientConnection(FMLNetworkHandler.java:153)
at cpw.mods.fml.common.network.FMLNetworkHandler.onConnectionReceivedFromClient(FMLNetworkHandler.java:107)
at it.d(NetLoginHandler.java:179)
at it.c(NetLoginHandler.java:72)
at hu.a(ServerListenThread.java:56)
at ht.b(SourceFile:29)
at net.minecraft.server.MinecraftServer.r(MinecraftServer.java:702)
at ho.r(DedicatedServer.java:270)
at net.minecraft.server.MinecraftServer.q(MinecraftServer.java:598)
at net.minecraft.server.MinecraftServer.run(MinecraftServer.java:497)
at fy.run(SourceFile:849)

We currently do not change terrain generation, so this should be reported to the Ars Magica folks if it is creating the problem. We have taken steps to avoid this error. This error is thrown on purpose, by the vanilla terrain generator whenever a terrain feature bleeds into an ungenerated chunk during the decoration phase of terrain generation. If a new chunk tries to apply its decorations (trees, structures, etc.) before another chunk finishes its decoration phase then vanilla code throws the exception. This is most often caused by terrain features (like big trees or other structures) that cross the boundary between chunks.