I just ran tcpdump again and am still getting the ARP issue at times even after everything has settled down. I haven't reset it to factory defaults yet. It's normal to have broadcast traffic at times, but the router sending ARP requests out to every IP address in the defined DHCP range is odd. Did dlink ever follow up about the issue saying whether it was intentional, a bug?
EDIT: If you want to see it for yourself (and have a linux box handy) you can run "tcpdump -i eth0 -n arp"
There is also a windows version of tcpdump that you can download (haven't tried it though)