give up on gnome-terminal and use xterm. it's not as fancy, but doesnt rely on all the rest of gnome running. obviously you have some startup problem, so you might want to check your x logs (not sure exactly where ubuntu puts them).probably /var/log/Xorg.0.log, unless it changed between hardy and jaunty...
there is usually a per-user log as well. under redhat it is .xession-errors.
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