> HOWEVER, I am able to remotely login and run Xsessions !!!

Yep.

> Causes of the problem and solutions would be appreciated.

Cause: xfs does not run in "-daemon"-mode, i.e. it does not
start in the background.

"My solution" for now: do not start with "/etc/rc/init.d/xfs" but on
command-line with:
xfs -port -1 &

Works for me...

So long

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