It's not a bug, Corey...it's their "feature". Meant to keep people from playing it via car.
Speed cutoff to accrue distance walked is ~10.5Km/hr based on personal observations; backed up by numerous player comments in real life and on the 'Net.
My normal riding speeds are ~25-30Km/hr depending on trail condition and winds. At that speed - coupled with the distances I cover in a single outing - it's very possible to hatch an entire loadout of 10K eggs, one after the other. If only the game would let me. :(
"Everyone wants to be an AM Gangsta until it's time to start doing AM Gangsta shit."