I can confirm this bug, however, it is not a problem with gshutdown as was 
originally mentioned:
[EMAIL PROTECTED]:~$ apt-cache policy gshutdown 
gshutdown:
  Installed: (none)
  Candidate: 0.2-0ubuntu2
  Version table:
     0.2-0ubuntu2 0
        500 http://us.archive.ubuntu.com intrepid/universe Packages

[EMAIL PROTECTED]:~$ uname -a
Linux lappy686-testing 2.6.26-2-generic #1 SMP Thu Jun 19 15:51:43 UTC 2008 
i686 GNU/Linux
[EMAIL PROTECTED]:~$ lsb_release -a
No LSB modules are available.
Distributor ID: Ubuntu
Description:    Ubuntu intrepid (development branch)
Release:        8.10
Codename:       intrepid

** Changed in: ubuntu
   Importance: Undecided => Medium

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shutdown goes to ubuntu password screen 
https://bugs.launchpad.net/bugs/250009
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