Comment 10 for bug 992646

LightDM will display the user added wallpaper (at any resolution I believe) - but only if it has permission to read the file (i.e. the relevant folders and file both allow "Others" read access). I had problems with this since even though my Pictures folder and image were readable, a subfolder therein was not. While this makes sense, I assume the default behavior should be more user-friendly: if a user adds a background image, LightDM will also display it.

I found this behavior both on a computer upgraded from Natty and one with a fresh Precise install.