I've seen this broken DNS situation on a number of machines upgraded to SL, on various kinds of home and corporate-style networks. It's definitely a bug in SL.
The symptom that I see is simply that a dig will work on a DNS name just fine, returning the proper IP address. However any other command that uses the DNS name (curl, ping, any GUI app like Safari, etc) will claim that the DNS name won't resolve. Obviously bogus and a bug.
I tried various things, including dscacheutil -flushcache, fooling with the network settings, Locations, etc, and some would provide a temporary workaround, usually with some disruption.
However, I happened across a Parallels support topic that provided what seems like a sure-fire workaround, either temporary or longer-lasting, until Apple fixes this bug.
The basic workaround is to issue the command +sudo killall mDNSResponder+ at the Terminal prompt when this issue occurs, and all starts working properly.
The Parallels support article has steps to make it a permanent workaround if desired, until Apple fixes it:
http://kb.parallels.com/en/6651