I have encountered this bug as well, and verified removing libvisual plugins 
fixed.
I'm running Ubuntu 8.10 on x86 32bit. (Thinkpad T61).

gnome-settings-daemon worked fine until the last reboot due to a slew of 
updates for Ubuntu 8.10.
I had restarted this morning due to those fixes, and then had this problem.
Sounds like there is a good handle on the problem.

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gnome-settings-daemon fails with libgstlibvisual.so  error
https://bugs.launchpad.net/bugs/287448
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