I've attached a repro for the problem. In an empty console app with the wsdl from the zip file saved to the project root, run the following command:
dotnet-svcutil MinimalRepo.wsdl -d MinimalRepro --internal
This will generate a file MinimalRepro\Reference.cs which has the type Data which has been created as a public type and not internal as specified. This has a property called DataRecords which is of type ArrayOfXElement which has been generated as an internal type. This causes a compilation error as a public type has a public member which references an internal type, which is invalid.
MinimalRepo.zip