Comment 18 for bug 359245

If it helps, a flashing keyboard possibly indicates a kernel panic; thus this might not be a problem with X but with the kernel itself. I'm having the same issues on Jaunty with 185.18.14. Instead of hard rebooting you could hold down Alt-SysReq and hit the keys e,s,b: see http://ubuntuforums.org/showthread.php?t=553452