I have the latest natty Alpha update, and when I open /usr/bin/xterm with compiz enabled under the "classic Ubuntu Desktop", the xterm opens up with a title bar and a border, and the text area is transparent. I do not see a shell prompt, and typing "exit" does not work in this window. None of the title bar buttons work either. I am able to raise and lower this window from the task bar, but that is the only functionality that I can get with this xterm.
Bothe konsole and gnome-terminal appear to function properly.
The hardware is a DELL laptop Latitiude D830 with a:
[ 21.902] (II) NVIDIA(0): NVIDIA GPU Quadro NVS 135M (G86GL) at PCI:1:0:0 (GPU-0)
Please see attached Xorg.0.log file for further X environment and nvidia driver information.