It seems like you are having some trouble with your ppi settings. If you are going to be designing for the screen (e.g. iPad, web) you need to use 72ppi. It may seem a bit odd as the iPad's actual ppi is significantly higher than this, but thats just the way it is. If you change your settings to 72 ppi, everything should go back to normal.
EDIT: Bob Bringhurst explains the difference between effective and actual ppis in this thread here: http://forums.adobe.com/message/4319794#4319794
thanks makes sense