Georeferencing a CAD file and converting to SHP in ArcGIS without distance distortion

i have a land parcels dwg file in an unknown co-ordinate system and i want to georeference the file in ArcMAp and convert it to shapefile but the problem is that whenever i georef the cad drawings directly or or through spatial adjustment by converting it into shapefiles, the distances get distorted. for instance, if the length of line is 31 metres it changes to 0.000334 metres after projecting and georeferencing drawing. can anyone tell me the detailed method to finish this task? The precise steps that i performed are:

• importing dwg file in arcmap and assigning projected co-ordinate system to file.


• georeferencing the dwg file through two control points by using an already georefenced tif file for destination points.

my cad drawing overlays on the tif file but main problem are the distances an area. they are inaccurate.