I updated and upgraded (safe)
New xorg and kdm  No change in behaviour.

interesting in KDM log is that 

1.  the xorg build is    Build Operating System: Linux 2.6.24-19-server i686 Ubuntu

2.  Current Operating System: Linux ubuntu 2.6.27-7-generic #1 SMP Fri Oct 10 03:55:24 UTC 2008 i686

NOTE:  I AM A HARDYUPGRADE FROM A ONE CORE CELERON 2.4 mhz.

attached is some KDM logs (screen just went black again)

X.Org X Server 1.5.1
Release Date: 23 September 2008
X Protocol Version 11, Revision 0
Build Operating System: Linux 2.6.24-19-server i686 Ubuntu
Current Operating System: Linux ubuntu 2.6.27-7-generic #1 SMP Fri Oct 10 03:55:24 UTC 2008 i686
Build Date: 10 October 2008  11:01:44AM
xorg-server 2:1.5.1-1ubuntu3 (<email address hidden>)
        Before reporting problems, check http://wiki.x.org
        to make sure that you have the latest version.
Module Loader present
Markers: (--) probed, (**) from config file, (==) default setting,
        (++) from command line, (!!) notice, (II) informational,
        (WW) warning, (EE) error, (NI) not implemented, (??) unknown.
(==) Log file: "/var/log/Xorg.0.log", Time: Fri Oct 10 20:18:09 2008
(==) Using config file: "/etc/X11/xorg.conf"
(WW) SIS: No matching Device section for instance (BusID PCI:0@0:0:0) found
(WW) SIS: No matching Device section for instance (BusID PCI:0@0:1:0) found
(WW) SIS: No matching Device section for instance (BusID PCI:0@0:2:0) found
(WW) SIS: No matching Device section for instance (BusID PCI:0@0:2:1) found
(WW) SIS: No matching Device section for instance (BusID PCI:0@0:2:5) found
(WW) SIS: No matching Device section for instance (BusID PCI:0@0:2:6) found
(WW) SIS: No matching Device section for instance (BusID PCI:0@0:2:7) found
(WW) SIS: No matching Device section for instance (BusID PCI:0@0:3:0) found
(WW) SIS: No matching Device section for instance (BusID PCI:0@0:3:1) found
(WW) SIS: No matching Device section for instance (BusID PCI:0@0:3:2) found
(WW) SIS: No matching Device section for instance (BusID PCI:0@0:4:0) found
kdmgreet(4991) KLocalePrivate::initEncoding: Cannot resolve system encoding, defaulting to ISO 8859-1.
T


The XKEYBOARD keymap compiler (xkbcomp) reports:
> Warning:          Duplicate shape name ""
>                   Using last definition
> Warning:          Duplicate shape name ""
>                   Using last definition
> Warning:          Duplicate shape name ""
>                   Using last definition
> Warning:          Duplicate shape name ""
>                   Using last definition
> Warning:          Duplicate shape name ""
>                   Using last definition
> Warning:          Duplicate shape name ""
>                   Using last definition
> Warning:          Duplicate shape name ""
>                   Using last definition
> Warning:          Duplicate shape name ""
>                   Using last definition
> Warning:          Duplicate shape name ""
>                   Using last definition
> Warning:          Duplicate shape name ""
>                   Using last definition
> Warning:          Duplicate shape name ""
>                   Using last definition
> Warning:          Duplicate shape name ""
>                   Using last definition
> Warning:          Duplicate shape name ""
>                   Using last definition
> Warning:          Duplicate shape name ""
>                   Using last definition
> Warning:          Multiple doodads named ""
>                   Using first definition
> Warning:          Multiple doodads named ""
>                   Using first definition
> Warning:          Multiple doodads named ""
>                   Using first definition
> Warning:          Multiple doodads named ""
>                   Using first definition
> Warning:          Multiple doodads named ""
>                   Using first definition
> Warning:          Multiple doodads named ""
>                   Using first definition
Errors from xkbcomp are not fatal to the X server


I will try a different keyboard than this several year old IBM one after I try this again tomorrow.