An addition to my post above.
After I hit ctrl+alt+F7 (tty7) and gdm + x started, a system crash report 
appeared, informing of a serious kernel issue and suggesting a restart.
Today I reinstalled all the latest kernel packages (2.6.31-10).
Now the systems works as it should. Karmic opens: grub - xsplash-gdm-xsplash-x.

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gdm upstart script fails to start gdm
https://bugs.launchpad.net/bugs/430494
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