This has been driving me crazy. Long delays on DNS lookups on Ubuntu 13.x desktop/laptops...
To fix dnsmasq errors, you should edit /etc/NetworkManager/NetworkManager.conf
sudo gedit /etc/NetworkManager/NetworkManager.conf
and comment out the line so it looks like this:
in the "[main]" section. To comment out the line, put a '#' at the beginning of the line, then save the file.
Then restart network-manager.
sudo restart network-manager
After this, non-local nameserver addresses will be entered into resolv.conf instead of the 127.* address.