As found by comment #21, it appears that mknbi might be the true cause of this bug.
As the comment suggests, possible remedies include:
1) Fix mknbi and backport the fix to Hardy and more recent Ubuntu releases.
2) Replace mknbi with wraplinux in LTSP. Would require packaging wraplinux and extensive testing, before it and updated LTSP boot image creations scripts can be pushed into Hardy and more recent releases.
As found by comment #21, it appears that mknbi might be the true cause of this bug.
As the comment suggests, possible remedies include:
1) Fix mknbi and backport the fix to Hardy and more recent Ubuntu releases.
2) Replace mknbi with wraplinux in LTSP. Would require packaging wraplinux and extensive testing, before it and updated LTSP boot image creations scripts can be pushed into Hardy and more recent releases.