I would contact your seller and let them know about the problems that you are having so they can notify their supplier and then take it back to them for a refund. I definitely would not use it in a project. I had a black that did the same thing even after 7 washings!!
Oh by the way, I'm going to a Gees Bend quilt show next week!! Definitely won't be buying their fabric ;) - I noticed that Pottery Barn has the rights and is selling quilts in BG designs.