Comment 4 for bug 447692

X definitely isn't starting before usplash quits in karmic; the usplash upstart job is defined as:

stop on (starting-dm
         or stopped rc RUNLEVEL=[2345]
         or starting rcS)

and each of {gdm,kdm,xdm} is configured to emit the 'starting-dm' signal before it starts - so unless you're starting X by hand (in which case the usplash package can't be expected to fix that for you), this doesn't look like a usplash bug. There have been some fixes in the past couple of days to usplash's upstart job (usplash 0.5.41 and above), but nothing that should ever have caused usplash to be running concurrently with X on startup.

The bug report shows that non-free nvidia drivers are in use. I think this is much more likely to be a bug in that driver; reassigning to nvidia-graphics-drivers-180 (whoop, please confirm which vintage of nvidia driver package you're using).