Comment 20 for bug 447226

I can also add that the X server is running, ps auxf |grep gdm output:
root 1024 0.0 0.3 18640 3212 ? Ssl 11:48 0:00 gdm-binary
root 1156 0.0 0.2 20092 2844 ? Sl 11:48 0:00 \_ /usr/lib/gdm/gdm-simple-slave --display-id /org/gnome/DisplayManager/Display2
root 1190 0.0 0.1 5788 1780 tty1 Ss+ 11:48 0:00 \_ /usr/bin/X :1 -br -verbose -auth /var/run/gdm/auth-for-gdm-Zkpm60/database -nolisten tcp

This is the output of Xorg.1.log (latest X created logfile)
___
X.Org X Server 1.7.6
Release Date: 2010-03-17
X Protocol Version 11, Revision 0
Build Operating System: Linux 2.6.24-25-server i686 Ubuntu
Current Operating System: Linux pc-titi 2.6.32-29-generic #58-Ubuntu SMP Fri Feb 11 19:00:09 UTC 2011 i686
Kernel command line: BOOT_IMAGE=/boot/vmlinuz-2.6.32-29-generic root=UUID=298a5af4-293e-4547-9bf2-0554c6167a34 ro quiet splash
Build Date: 10 December 2010 05:53:04PM
xorg-server 2:1.7.6-2ubuntu7.5 (For technical support please see http://www.ubuntu.com/support)
Current version of pixman: 0.16.4
        Before reporting problems, check http://wiki.x.org
        to make sure that you have the latest version.
Markers: (--) probed, (**) from config file, (==) default setting,
        (++) from command line, (!!) notice, (II) informational,
        (WW) warning, (EE) error, (NI) not implemented, (??) unknown.
(==) Log file: "/var/log/Xorg.1.log", Time: Sun Mar 6 11:48:35 2011
(==) Using config directory: "/usr/lib/X11/xorg.conf.d"
(==) No Layout section. Using the first Screen section.
(==) No screen section available. Using defaults.
(**) |-->Screen "Default Screen Section" (0)
(**) | |-->Monitor "<default monitor>"
(==) No monitor specified for screen "Default Screen Section".
        Using a default monitor configuration.
(==) Automatically adding devices
(==) Automatically enabling devices
(WW) The directory "/usr/share/fonts/X11/cyrillic" does not exist.
        Entry deleted from font path.
(==) FontPath set to:
        /usr/share/fonts/X11/misc,
        /usr/share/fonts/X11/100dpi/:unscaled,
        /usr/share/fonts/X11/75dpi/:unscaled,
        /usr/share/fonts/X11/Type1,
        /usr/share/fonts/X11/100dpi,
        /usr/share/fonts/X11/75dpi,
        /var/lib/defoma/x-ttcidfont-conf.d/dirs/TrueType,
        built-ins
(==) ModulePath set to "/usr/lib/xorg/extra-modules,/usr/lib/xorg/modules"
(II) The server relies on udev to provide the list of input devices.
        If no devices become available, reconfigure udev or disable AutoAddDevices.
(II) Loader magic: 0x81f0e80
(II) Module ABI versions:
        X.Org ANSI C Emulation: 0.4
        X.Org Video Driver: 6.0
        X.Org XInput driver : 7.0
        X.Org Server Extension : 2.0
(--) using VT number 1

Fatal server error:
xf86OpenConsole: VT_WAITACTIVE failed: Interrupted system call

Please consult the The X.Org Foundation support
         at http://wiki.x.org
 for help.
Please also check the log file at "/var/log/Xorg.1.log" for additional information.

 ddxSigGiveUp: Closing log
____

If I stop gdm, start plymouth, stop plymouth, start gdm I get the graphical session working.