I seem to have this same problem, however, I have an issue severly
compounding it.  In addition to the computer locking when the lid is
closed, sometimes the login screen doesn't appear.  All I have is a
blank screen of my desktop.  I haven't found a way to fix this or get
around it yet.  Except for a hard reboot.  Although I haven't really
tried pressing Ctrl+Alt+F1 and killing/messing with things.

I just did an upgrade from 11.10 to 12.04 about 24 hours ago.  I tried
unlocking everything and hopefully that will be a quick fix for my
problems.  But, having about a 50% chance of having to reboot the system
eveytime the lid is closed is pretty bad.  I am not sure if this should
be posted on a different or new bug report, but as it seemed related I
figured I should start by posting it here.

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You received this bug notification because you are a member of Desktop
Packages, which is subscribed to gnome-power-manager in Ubuntu.
https://bugs.launchpad.net/bugs/995840

Title:
  When laptop lid is closed screen locks even if it should not

Status in “gnome-power-manager” package in Ubuntu:
  Confirmed

Bug description:
  In power options the settings for When lid is closed are DO NOTHING
  both for on battery and on line power. But if I close the lid the
  computer locks.

  ProblemType: Bug
  DistroRelease: Ubuntu 12.04
  Package: powerman (not installed)
  ProcVersionSignature: Ubuntu 3.2.0-24.37-generic 3.2.14
  Uname: Linux 3.2.0-24-generic x86_64
  ApportVersion: 2.0.1-0ubuntu7
  Architecture: amd64
  Date: Mon May  7 11:39:04 2012
  InstallationMedia: Ubuntu 12.04 LTS "Precise Pangolin" - Release amd64 
(20120425)
  SourcePackage: powerman
  UpgradeStatus: No upgrade log present (probably fresh install)

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