net.eth0.dns1 is a legacy system property that is not used by the resolver anymore.
the "official way" is to define one of:
net.dns1
net.dns2
...
additionally, you can use a process-specific list with:
net.dns1.<pid>
net.dns2.<pid>
...
where <pid> is the numerical process identifier of your program.
What you see is probably a bug in netcfg