Item frames and leash knots appear at the wrong location

The bug

If you place item frames, they'll appear at the wrong location (far away). Upgrading worlds that already had item frames, will cause the same.
This also affects; leash knots, they'll seem to jitter far out.

How to reproduce

Video demonstrating the issue: https://www.youtube.com/watch?v=VPgL-Qb_87o