Yes it could be caused by a faulty board, and no I have never seen it hand on CPU INIT when overclocking.

The board sounds like it has issues, but as Grnfinger said, try the Asus 1307 BIOS and the oter suggestion first. I have used Kets bios for the board with no issues so I know the BIOS works, but its worth a try. The fact it needed excessive voltages to overclock may indicate something wrong with the VRM.