I can confirm that I have this problem on a Samsung N150 pine trail laptop 
(Intel graphics chipset).
Since all new accounts are set up with normal (metacity) visual effects they 
all suffer from this graphical corruption. Logging in with a Gnome Failsafe 
session allows you to disable visual effects on an individual basis, but 
earlier in the thread Alkis mentioned LTSP and in a posting on their forum 
provided a command line workaround that solves the issue for all users:

sudo gconftool-2 --direct --config-source
xml:readwrite:/etc/gconf/gconf.xml.mandatory --type string --set
/desktop/gnome/session/required_components/windowmanager metacity

-- 
system GUI turn upside down when visual effects changed from none to normal
https://bugs.launchpad.net/bugs/267269
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which is subscribed to xserver-xorg-video-intel in ubuntu.

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