I had a very similar problem using the xfce front-end.  Things started
going poorly toward the end of the pam upgrade where the daemon was
restarted.  It hung there for more than an hour with no system activity.
I killed the restart job and the upgrade resumed.  It eventually decided
to fail.  I'm restarting from scratch.

** Attachment added: "dist-upgrade.tar.gz"
   http://launchpadlibrarian.net/10083769/dist-upgrade.tar.gz

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Situation is critical for me: network upgrade failed-updater has hanged in the 
middle, system is in intermediate state and I see no way to resume update 
(Kubuntu x64 7.04 to 7.10)
https://bugs.launchpad.net/bugs/154434
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