Comment 1 for bug 780791

Notes from this page have a fix:
http://plugable.com/2009/11/16/setting-up-usb-multiseat-with-displaylink-on-linux-gdm-up-to-2-20/

7. xrandr workaround

[update: this workaround is not needed when running xf86-video-fbdev or with recent displaylink X servers with this patch
http://git.plugable.com/gitphp/index.php?p=xf-video-udlfb&a=commit&h=54d15f63548a44c69fc3fe80191147b42061a67a
]

The DisplayLink X server currently has limited RANDR support, but later versions of GDM assume better. So for the time being, a workaround is required to get GDM applications (including gdmlogin) to display properly within the actual screen area -- otherwise they tend to think the screen has a strange rotation, and display themselves completely off it.

Add these lines into /etc/gdm/Init/Default, right after the definition of gdmwhich()

XRANDR=`gdmwhich xrandr`
if [ "x$XRANDR" != "x" ]; then
  $XRANDR -o 0
fi

I applied the fix to /etc/gdm/Init/Default and things are now working for me just as with 10.10