Nibal,
I understand it might be a later thing if you are under a deadline, but yes, cleaning the linework just meant try and reduce the amount of vertices that need to be seen by the program. I am unsure how the lines were created in the first place, but we typically see this level of detail when converting intricate splines into polylines.
You are welcome to give the creation of a UCS a try. Doing this just helped me use the highlight station tool so I thought I would suggest it. I know you have used our UCS tools before, but just in case, the link below will walk you through how to use New UCS. Just make sure to pick a base point on site.
Creating a UCS
As far as the millimeters vs. meters plan goes, we would typically suggest (or have more commonly seen) Units be set to meters for a plan that size. One of the reasons it is an issue when in millimeters is that the display number in mm over thousands of km is quite large, so the processing that needs to take place is just a lot of big numbers.
I hope that clarifies things a bit more, but we are happy to continue this conversation as needed.
Regards,