Comment 10 for bug 1228079

Ok, I may have a workaround (not sure yet of any side effects or what else could be broken...)

Since we did the symlink to /bin/init, this is what .Xsession looks like as we know:
init: unity-gtk-module main process (3055) terminated with status 127
init: logrotate pre-start process (3053) terminated with status 127
init: dbus pre-start process (3056) terminated with status 127
init: ssh-agent pre-start process (3054) terminated with status 127
init: ssh-agent post-stop process (3062) terminated with status 127

If you look at ~/.cache/upstart as your LDAP based user, you'll notice in log files for dbus, etc for errors, sure enough the error is it can't find initctl:
/proc/self/fd/9: 3: /proc/self/fd/9: initctl: not found
/proc/self/fd/9: 3: /proc/self/fd/9: initctl: not found
/proc/self/fd/9: 3: /proc/self/fd/9: initctl: not found

I added a symlink from /sbin/initctl to /bin like we did with init, and I am now able to log in again.