I have exactly the same bug. It also happens with a Radeon HD 6850 with
fglrx drivers installed.

"1) There are some weird graphical artifacts near the top of the screen that 
change as I type in my password." 
This happens to me aswell. Afther this, lightdm restarts or crashes with a 
black screen.

It also appears to be completely random, happens about 1/3 of the time I
start up the computer.

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https://bugs.launchpad.net/bugs/874218

Title:
  LightDM restarts after first login attempt

Status in “lightdm” package in Ubuntu:
  Confirmed

Bug description:
  When I initially boot or reboot my computer and am presented with the
  LightDM login screen, two strange things happen:

  1) There are some weird graphical artifacts near the top of the screen
  that change as I type in my password.

  2) After entering the password (correctly) and hitting enter, the
  LightDM screen disappears, my displays are turned off, and only
  moments later I'm presented with the login screen again. Logging in
  the second time is successful and I'm able to reach the desktop.

  It seems like these might be part of the same problem. I can't say for
  sure whether this is consistent behavior because I only upgraded
  yesterday.

  I'm using NVIDIA binary drivers with TwinView, Oneiric.

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