Pegging of a parameter is likely to truncate the confidence limit (since an extra impediment to chi-squared minimisation is introduced). Where the limit encountered is real (i.e. the user knows it cannot be crossed) the derived confidence limit stands. If the bound is arbitrary then it should be removed and the confidence region reevaluated.
Errors arising in the fitting process, and possible remedial action, are discussed in the HELP for SFIT.