patch 7.4.2115
Problem:    Loading defaults.vim with -C argument.
Solution:   Don't load the defaults script with -C argument.  Test sourcing
            the defaults script.  Set 'display' to "truncate".
diff --git a/src/main.c b/src/main.c
index f24bda2..51e4483 100644
--- a/src/main.c
+++ b/src/main.c
@@ -90,6 +90,8 @@
 
 static char_u *start_dir = NULL;	/* current working dir on startup */
 
+static int has_dash_c_arg = FALSE;
+
     int
 # ifdef VIMDLL
 _export
@@ -1928,6 +1930,7 @@
 
 	    case 'C':		/* "-C"  Compatible */
 		change_compatible(TRUE);
+		has_dash_c_arg = TRUE;
 		break;
 
 	    case 'e':		/* "-e" Ex mode */
@@ -3001,7 +3004,7 @@
 #ifdef USR_EXRC_FILE2
 		&& do_source((char_u *)USR_EXRC_FILE2, FALSE, DOSO_NONE) == FAIL
 #endif
-		)
+		&& !has_dash_c_arg)
 	    {
 		/* When no .vimrc file was found: source defaults.vim. */
 		do_source((char_u *)VIM_DEFAULTS_FILE, FALSE, DOSO_NONE);