Here is the scenario that causes the failure.(by Mats)

1. The to-be corrupt log event (let's call it X), is split into two
   packets B and C on the network level (net_write_buff()). The parts
   are X = (x',x''). The part x' ends up in packet B and part x''
   ends up in packet C. Prior to the corrupt event X, the event Y has
   been written successfully, but has been split into two packets as
   well, which we call (y',y'').
2. The master sends packet A = (y'',x') to the slave, increases the
   packet sequence number, the slave receives the packet, but fails
   to reply before the master gets a timeout.
3. Since the master got a timeout, it reports failure, and aborts
   sending the binary log by exiting mysql_binlog_send(). However, it
   leaves the buffer intact, still holding y'' (but not x', since the
   write_pos is not increased).
4. After exiting mysql_binlog_send(), the master does a
   disconnection of the client thread, which involves sending an
   error message e to the client (i.e., the slave).
5. In this case, net_write_buff() is used again, but this time the
   old contents of the packet is used so that the new packet is
   D = (y'',e). Note that this will use a new packet sequence number,
   since the packet number was increased in step 2.
6. The slave receives the tail y'' of the Y log event, concatenates
   this with x' (which it already received), and writes the event
   (x',y'') it to the relay log since it hasn't noticed anything is
   amiss.
7. It then tries to read more bytes, which is either e (if the length
   given for X just happened to match the length given for Y, or just
   plain garbage because the slave is out of sync with what is
   actually sent.
8. After a while, the SQL thread tries to execute the event (x',y''),
   which is very likely to be just nonsense.

The problem can be fixed by not resetting net->error after the call of 
mysql_binlog_send, so the error message will not be sent and the connection
will be closed.