I took your code and embedded it in this document:

-------
\documentclass{article}

 \usepackage{epic}     % required by ecltree and fancybox packages
 \usepackage{ecltree}  % to draw the GP trees
 \usepackage{fancybox} % required by \Ovalbox

 % minimum distance between nodes on the same line
 \setlength{\GapWidth}{1em}    

 % draw with a thick dashed line, very nice looking
 \thicklines \drawwith{\dottedline{2}}   

 % draw an oval and center it with the rule.  You may want to fool with the
 % rule values, though these seem to work quite well for me.  If you make the
 % rule smaller than the text height, then the GP nodes may not line up with
 % each other horizontally quite right, so watch out.
 \newcommand{\gpbox}[1]{\Ovalbox{#1\rule[-.7ex]{0ex}{2.7ex}}}

\begin{document}

\begin{center}
\begin{minipage}[!ht]{1cm}
\begin{bundle}{\gpbox{L}}\chunk{\begin{bundle}{\gpbox{L}}\chunk{\begin{bundle}{\gpbox{L}}\chunk{\begin{bundle}{\gpbox{P}}\chunk{\gpbox{2}}\chunk{\gpbox{1}}\end{bundle}}\end{bundle}}\end{bundle}}\end{bundle}
\end{minipage}
\end{center}

\end{document}
--------


I have attached a PDF showing the result: as you can see, it looks fine.  If you don't get the same result, you may want to look into your latex system (I'm on the latest MacTeX version).

Sean