Dug line out producing spoil (7)
I believe the answer is:
indulge
'spoil' is the definition.
(I know that spoil can be written as indulge)
'dug line out' is the wordplay.
'out' indicates anagramming the letters (out can mean wrong or inaccurate).
'dug'+'line'='dugline'
'dugline' is an anagram of 'INDULGE'.
'producing' is the link.
(Other definitions for indulge that I've seen before include "take to the drink?" , "Gratify (an appetite)" , "Favour, gratify" , "pet" , "Satisfy (an interest)" .)