I assume this has been posted before but for weeks I've been trying different methods to fix the Markarth guard glitch. Last night I FINALLY was able to fix it. I started off siding with the storm cloaks and took over whiterun. Unfortunately I was unable at that point to continue with that quest line because the Jarl of Markarth constantly attacked me. I then did the Alduins Bane quest which ended up leading me to the Seasons unending quest. (see link for more info)

http://elderscrolls.wikia.com/wiki/Season_Unending

Anyway after getting the peace treaty and giving Markarth aka The reach over to the storm cloaks I am now able to enter Markarth without getting attacked! I was finally able to finish The House of Horrors quest!
Hopefully this helps someone out!

The Jarl of Markarth (The Old One) does relocate to the Solitude Palace basemant, so hopefully in the move he lost his combat aggression, otherwise going into the Solitude palace might be an adventure.

That's a good solution to the problem though and I do hope Beth fixes that quest.

Ugh! I haven't tried to go to Solitude yet. I'm going to do that later. Hopefully it works! Thanks for the heads up.