It is the kernel that killed my system. I used the grub menu to boot into the previous kernel, and I am back with a working.

This is the list of changes the last update did.
system.Start-Date: 2011-01-15  10:02:18
Install: 
linux-image-2.6.35-25-generic:amd64 (2.6.35-25.43), 
linux-headers-2.6.35-25-generic:amd64 (2.6.35-25.43), 
linux-headers-2.6.35-25:amd64 (2.6.35-25.43)
Upgrade: mythtv-database:amd64 (0.24.0+fixes.20110112.2394a9d-0ubuntu0mythbuntu2, 
0.24.0+fixes.20110115.46a0dda-0ubuntu0mythbuntu2), 
mythmusic:amd64 (0.24.0+fixes.20110112.2394a9d-0ubuntu0mythbuntu2, 
0.24.0+fixes.20110115.46a0dda-0ubuntu0mythbuntu2),
 libnautilus-extension-dev:amd64 (2.32.0-0ubuntu1.1, 
2.32.0-0ubuntu1.2), mythtv:amd64 (0.24.0+fixes.20110112.2394a9d-0ubuntu0mythbuntu2, 
0.24.0+fixes.20110115.46a0dda-0ubuntu0mythbuntu2), 
nautilus:amd64 (2.32.0-0ubuntu1.1, 2.32.0-0ubuntu1.2), 
mytharchive:amd64 (0.24.0+fixes.20110112.2394a9d-0ubuntu0mythbuntu2, 
0.24.0+fixes.20110115.46a0dda-0ubuntu0mythbuntu2), 
mythtv-themes:amd64 (0.24.0+fixes.20110112.2394a9d-0ubuntu0mythbuntu2,
0.24.0+fixes.20110115.46a0dda-0ubuntu0mythbuntu2), mythtv-theme-metallurgy:amd64 (0.24.0+fixes.20110112.2394a9d-0ubuntu0mythbuntu2, 0.24.0+fixes.20110115.46a0dda-0ubuntu0mythbuntu2), 
transmission-gtk:amd64 (2.04-0ubuntu2, 2.05-0ubuntu0.1),
python-apt:amd64 (0.7.96.1ubuntu11, 0.7.96.1ubuntu11.1), 
xserver-xorg-video-savage:amd64 (2.3.1-2ubuntu2, 2.3.1-2ubuntu2.1), 
mythgallery:amd64 (0.24.0+fixes.20110112.2394a9d-0ubuntu0mythbuntu2, 0.24.0+fixes.20110115.46a0dda-0ubuntu0mythbuntu2), 
libmyth-python:amd64 (0.24.0+fixes.20110112.2394a9d-0ubuntu0mythbuntu2, 0.24.0+fixes.20110115.46a0dda-0ubuntu0mythbuntu2), 
mythtv-common:amd64 (0.24.0+fixes.20110112.2394a9d-0ubuntu0mythbuntu2, 0.24.0+fixes.20110115.46a0dda-0ubuntu0mythbuntu2), 
transmission-common:amd64 (2.04-0ubuntu2, 2.05-0ubuntu0.1), 
mythweb:amd64 (0.24.0+fixes.20110112.2394a9d-0ubuntu0mythbuntu2, 0.24.0+fixes.20110115.46a0dda-0ubuntu0mythbuntu2), 
mythtv-theme-childish:amd64 (0.24.0+fixes.20110112.2394a9d-0ubuntu0mythbuntu2, 0.24.0+fixes.20110115.46a0dda-0ubuntu0mythbuntu2), 
mythtv-backend:amd64 (0.24.0+fixes.20110112.2394a9d-0ubuntu0mythbuntu2, 0.24.0+fixes.20110115.46a0dda-0ubuntu0mythbuntu2),
 xserver-xorg-input-evdev:amd64 (2.3.2-6ubuntu3, 2.3.2-6ubuntu3.1), linux-headers-generic:amd64 (2.6.35.24.30, 2.6.35.25.31), 
mythtv-theme-graphite:amd64 (0.24.0+fixes.20110112.2394a9d-0ubuntu0mythbuntu2, 0.24.0+fixes.20110115.46a0dda-0ubuntu0mythbuntu2), 
linux-image-generic:amd64 (2.6.35.24.30, 2.6.35.25.31), 
mythtv-dbg:amd64 (0.24.0+fixes.20110112.2394a9d-0ubuntu0mythbuntu2, 0.24.0+fixes.20110115.46a0dda-0ubuntu0mythbuntu2), 
libmythtv-perl:amd64 (0.24.0+fixes.20110112.2394a9d-0ubuntu0mythbuntu2, 0.24.0+fixes.20110115.46a0dda-0ubuntu0mythbuntu2), 
nautilus-data:amd64 (2.32.0-0ubuntu1.1, 2.32.0-0ubuntu1.2), mythtv-backend-master:amd64 (0.24.0+fixes.20110112.2394a9d-0ubuntu0mythbuntu2, 0.24.0+fixes.20110115.46a0dda-0ubuntu0mythbuntu2), 
mythtv-theme-arclight:amd64 (0.24.0+fixes.20110112.2394a9d-0ubuntu0mythbuntu2, 0.24.0+fixes.20110115.46a0dda-0ubuntu0mythbuntu2), 
libnautilus-extension1:amd64 (2.32.0-0ubuntu1.1, 2.32.0-0ubuntu1.2), mythweather:amd64 (0.24.0+fixes.20110112.2394a9d-0ubuntu0mythbuntu2, 0.24.0+fixes.20110115.46a0dda-0ubuntu0mythbuntu2), 
mythvideo:amd64 (0.24.0+fixes.20110112.2394a9d-0ubuntu0mythbuntu2, 0.24.0+fixes.20110115.46a0dda-0ubuntu0mythbuntu2), 
mythtv-frontend:amd64 (0.24.0+fixes.20110112.2394a9d-0ubuntu0mythbuntu2, 0.24.0+fixes.20110115.46a0dda-0ubuntu0mythbuntu2), 
mythtv-theme-mythbuntu:amd64 (0.24.0+fixes.20110112.2394a9d-0ubuntu0mythbuntu2, 0.24.0+fixes.20110115.46a0dda-0ubuntu0mythbuntu2), 
libmyth-0.24-0:amd64 (0.24.0+fixes.20110112.2394a9d-0ubuntu0mythbuntu2, 0.24.0+fixes.20110115.46a0dda-0ubuntu0mythbuntu2),
mythtv-transcode-utils:amd64 (0.24.0+fixes.20110112.2394a9d-0ubuntu0mythbuntu2, 0.24.0+fixes.20110115.46a0dda-0ubuntu0mythbuntu2)
End-Date: 2011-01-15  10:04:22

The messages file is full of errors like this:
Jan 15 10:06:07 Compromise kernel: [   48.435039] radeon 0000:02:00.0: r600_cs_track_validate_cb:203 cb pitch (64) invalid
Jan 15 10:06:07 Compromise kernel: [   48.435043] radeon 0000:02:00.0: r600_packet3_check:1108 invalid cmd stream 423

where "pitch (64)" has different numbers in the parenthesis and "stream 423" has different numbers.