Comment 2 for bug 553200

I get exactly the same error, using nvidia-96 driver and having gdm theme installed (in my case it is xubuntu-gdm-theme). If you remove *-gdm-theme package it starts working.

But as it is, it makes xubuntu/ubuntu unusable for unexperienced user after they have installed nvidia drivers. So, in my opinion this is very important bug. It seems that this bug has appeared just recently with latest gdm update.