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I am just motivated a lot seeing this. I have been facing a similar situation like yours for past few months. I couldn't cross 660 barrier in MGMAT though i am able to score above 720 in GMATPrep. I believe my scores are inflated as I have seen most of the questions in the forum itself. However I don't usually remember the question for a long time yet it might have an impact. Coming to the RC part its exactly as you said. OG/GMAT RCs i can nail them but end up confused with two choices in RC and CR inference questions, while the same does not happen in GMAT questions. I am not very sure if we are to worry about this, because 90% of the people have scores close to their MGMAT mocks as well, but there are few who doesn't get used to MGMAT style.

Your scores will be inflated if
* you haven't taken with strict testing conditions as in 8 min break with AWA
* retakes
* you have solved the GMATPrep documents
* you are always browsing through the forum and have seen too many posts with subject GMAT PREP

Try to take GMAT Prep 2 with AWA and strict 8 min break. If possible download the latest version as well and take those two tests. Besides that you can also take the free gmat mocks available in the right pane of btg site, veritas prep and kaplan free test. If the scores are consistent then you can probably go ahead taking the test

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Getting defeated is just a temporary notion, giving it up is what makes it permanent.
http://gmatandbeyond.blogspot.in/

Thanks Sam2304. I am planning to take 2nd GMAT PREP in a couple of days with AWA and 8 Min break just like the actual GMAT. That should hopefully clear my doubts about this. Moreover, I have downloaded the latest version of GMAT PREP (2.0).
I don't look at the "Reading Comprehension" section of the forum (that rules out inflation of my GMAT PREP score wrt RC). So, all the GMAT PREP passages were totally new to me. Also, you are right about most people scoring very close to what they score on MGMAT CATs in the actual GMAT which is why I was concerned. Just wanted to make sure that there are actually people like me who are struggling with MGMAT.
It would still be good to know if there are readers in the forum who couldn't "Beat the MGMAT" but "Beat the GMAT"

The new GMAT prep will have integrated reasoning section instead of one essay, so you have to do something about it. And yes even I don't peek into RC section often but my SCs, most of them I would have already faced them in the forum . I am trying not to be so enthusiastic about solving problems in the forum these days About the people you asked - Yes there are people who have struggled with MGMAT and got a great score. You can check this guy's debrief.

http://gmatclub.com/forum/from-600-even-after-3-months-of-hard-work-to-720-in-20-days-125773.html

_________________
Getting defeated is just a temporary notion, giving it up is what makes it permanent.
http://gmatandbeyond.blogspot.in/

I think there is something inherently wrong with MGMAT's scoring system. They always say not to focus too much on the first 10 questions. But if you track your score on their CAT's it pretty much entirely dependent on the latter questions you answer.

On the Verbal section of the last MGMAT CAT I wrote, I was literally in the 99th percent until about the 30th question. Consistently getting 3/4 or 4/5 700-800 level questions right. Then My accuracy dropped during the last 10 questions to 50/50 and my percentile went down to 85%. Which is the verbal score I received.

If I was 95%+ percentile in verbal for 75% of the CAT and in the 80th percentile for the last 10 questions shouldn't the final score weight the questions equally?

Instead it seems as though my final score is based primarily on the last 10 questions of the test.

I realize it is a computer adaptive test but I don't think that means your score is the difficulty level of whatever question you do last.

If that was the case I would just guess on the first 20 questions and leave my self 70 minutes to do the last 20 questions and make sure I nail them all.