My version of Mach (v3.042.029) actually renders the toolpath a little differently. I'm just seeing the blue and white and not the extra purple arcs. NCPlot does not show the odd white and purple arcs at all. (BTW, NCPlot is a nice program to have installed, just to do a sanity check on your code when these things happen.)
If you single step through the code in Mach, it looks perfect. The correct movements are highlighted and I don't see any funny business. The odd stuff looks like it might should on the last straight (G01) line movement before the next downward Z movement.
Those G01 moves have a G40 (cutter compensation off) at the end. I don't use cutter comp, so I don't know what Mach expects. I see G41 (cutter comp on) but I don't see any values indicating how much to offset for the cutter diameter.
If you comment out the G40 codes (just use ;G40) then Mach renders everything ok. My guess it you are using a bad post processor or something is funny with the way Mach is setup to handle cutter comp.
What happens if you try and run the code? No cutting, just set a safe Z height and run the code.