I experience the same problem on the same Dell Studio 1558 model.
The problem still occurs in 2.6.32-19-generic #28~pre1 SMP Wed Mar 31 14:57:35 UTC 2010 x86_64.
More recovery notes: after getting into the bad state, you can regain a working desktop by switching to Ctrl-Alt-F1 then back to Ctrl-Alt-F7 again (note that on this Dell model, you might actually need to press Ctrl-Fn-Alt to enable the "regular" numbered F-key functionality, depending on BIOS configuration).
I experience the same problem on the same Dell Studio 1558 model.
The problem still occurs in 2.6.32-19-generic #28~pre1 SMP Wed Mar 31 14:57:35 UTC 2010 x86_64.
More recovery notes: after getting into the bad state, you can regain a working desktop by switching to Ctrl-Alt-F1 then back to Ctrl-Alt-F7 again (note that on this Dell model, you might actually need to press Ctrl-Fn-Alt to enable the "regular" numbered F-key functionality, depending on BIOS configuration).