Hmmm... 121V n-g What is hot to ground?
What is, or isn't the circuit doing?
What are your phase voltages? Compare them to this.
Check against other known grounds, other EGC's or water pipe. One of these is not grounded, the ECG, or the "grounded conductor". (neutral)
What type of circuit is it 120 2-wire, or 120/240 3-wire? Are you sure? Shut everything off get your ohms between this neutral and ground (for referance), and check voltage as you turn on only one breaker at a time. You may have a double feed, or worse lost neutral on a 3-wire. (And it just happens to measure 121v, this will happen if the associated loads are near even.)
Now if the ground is really live, it is obviously not making a strong path back to the main. Some moron may have pulled the ground out, to avoid looking for the short they had no idea of how to find. If thats the case, ground it and go look for the short.
As for the jumpy meter, most DMM's are auto ranging, and will flash other voltages at first. And I have never had a DMM trick me, but I have tricked it, by tricking myself into thinking that was what I was really looking at. Wiggy's have tricked me!
