Upgraded to Ubuntu 14.10 (Utopic Unicorn) this weekend. The upgrade process went without a hitch and latest Gnome 3.12 desktop experience is good except for this massive title bar issue. Reblogging Mikey's solution for this minor Gnome 3 annoyance. Thanks Mikey!.
$ sudo sed -i "/title_vertical_pad/s/value=\"[0-9]\{1,2\}\"/value=\"0\"/g" /usr/share/themes/Adwaita/metacity-1/metacity-theme-3.xml
Reported the bug, Please feel free to track the bug #1385597 and provide your feedback.