This was the gdm.conf-custom file. Removing the last two sections solved the problem.
[daemon] [security] [xdmcp] [gui] [greeter] [chooser] [debug] [servers]# Override display 1 to use Xgl (DISPLAY 1 IMPORTANT FOR ATI FGLRX). 0=Xgl [server-Xgl] name=Xgl server command=/usr/bin/Xgl :0 -fullscreen -ac -accel glx:pbuffer -accel xv:fbo flexible=true -- gdmsetup does not work, lacks custom.conf https://launchpad.net/bugs/84458 -- ubuntu-bugs mailing list ubuntu-bugs@lists.ubuntu.com https://lists.ubuntu.com/mailman/listinfo/ubuntu-bugs
