**Core Concept**
The question tests the understanding of **adverse effects** of high plasma concentrations of **phenytoin**, an antiepileptic medication. Phenytoin has a narrow therapeutic index, making it crucial to monitor its levels to avoid toxicity.

**Why the Correct Answer is Right**
High plasma concentrations of phenytoin can lead to **cerebellar toxicity**, manifesting as **nystagmus**, **ataxia**, and **dizziness**. This occurs because phenytoin affects the cerebellar pathways, leading to impaired coordination and balance. As levels increase, more severe effects such as **confusion** and **seizures** can occur due to the drug's paradoxical effect on neuronal excitability.

**Why Each Wrong Option is Incorrect**
**Option A:** Incorrect because while **gingival hyperplasia** is a side effect of phenytoin, it is not directly related to high plasma concentrations.
**Option B:** Incorrect as **hirsutism** is another side effect but not specifically related to high levels of the drug.
**Option D:** Incorrect because **osteomalacia** is related to long-term use of antiepileptics like phenytoin, not high plasma concentrations.

**Clinical Pearl / High-Yield Fact**
It's crucial to remember that phenytoin follows **zero-order kinetics** at therapeutic doses, meaning small increases in dose can lead to disproportionately large increases in plasma concentration, increasing the risk of toxicity.

**Correct Answer:** C. Ataxia