The following commit appears to have solved the problem, thanks!

commit 6e2fb6f9f26f6a4ae8fbfb5ca0e69a5939adade2
Author: martin rudalics <rudalics@gmx.at>
Date:   Sun Aug 10 10:26:28 2014 +0200

    Fix handling of menu bar line on TTY frames (Bug#18136) (Bug#18196).

-dhruva


On Sat, Aug 9, 2014 at 7:46 PM, Eli Zaretskii <eliz@gnu.org> wrote:

> > Date: Sat, 9 Aug 2014 14:14:14 -0700
> > From: dhruva <dhruvakm@gmail.com>
> > Cc: emacs development <emacs-devel@gnu.org>
> >
> > Give me some pointers and I will debug.
>
> I'd start by putting a breakpoint in adjust_frame_size, and see who
> calls it with what values.
>