Fixed as of 9/20/2012
I have found that the steps below are the most efficient way to farm dungeons:
1) Take off all gear (Make a Naked set to speed this up)
2) Enter Instance
3) Queue for BG
4) Macro 1 & Reboot WoW <--- Fresh Client
5) Die
6) Run to Boss
7) Relog <---- Logout normally with countdown timer, then login your character [no need to start a new client]
8) Equip Gear
9) Kill & Loot Boss
10) Take off all gear
11) Die again
12) Enter Instance
13) Leave Instance
14) Reset Instance
15) Rinse and Repeat
Steps 12 and 13 are mandatory. If you Enter Instance and Reset without leaving, the next time you do steps 1-5 you will not be a ghost on top of your body. You will be ported out of the dungeon and be at the graveyard, which messes up the entire process and creates wasted time.
Credit to RAOV for Macro 1, Novalok for the discovery, and xPlacebox for posting in the exploits section.
Still working for Patch 5.0.5
Macro 1
/run AcceptBattlefieldPort(1, 1)
/run ForceQuit()
This thread is just to assist anyone having problems with the process from watching the video alone.
xPlacebox's Video
ROAV's Most Recent Video
RAoV 2.0 Exploiting Saga - YouTube
Navalok's Video
Past Instance Portals 5.0.4 - YouTube