Comment 3 for bug 371181

The problem may be related to Ubuntu (experienced on 10.4) apparently executing the commands

xhost +si:localuser:`id -un`
xhost +si:localuser:root
xhost +si:localuser:gdm

or does something equivalent when you log in. Just type "xhost" to see the list of non-xauth authorizations currently enabled for your X11 server. The first of the above lines is in

  /etc/X11/Xsession.d/60x11-common_localhost

The exmh background daemon considers the presence of any of these to be bad and therefore refuses to work. Executing the above three lines with + changed to - is a workaround, but ultimately exmh-bg (or a library it uses) probably needs patching to tolerate this practice.

See also "man xhost".