I've the same problem also in 8.10 final.

What I did is:
- install Kubuntu 8.10 (fresh install)
- sudo aptitude install nis
- added the +:::.. entries to passwd, group, shadow
- sudo invoke-rc.d nis restart (this works fine!)
But then... after a reboot, nis does not start, it will hang at:

binding to YP server
...
...
...
etc.
... [failure]


after a while it times-out, and nis is non-functioning (and I cannot login at 
all, even though I've setup a password for the root account). Using rescue 
mode, I was able to login.
Then I tried the following
- hardcode ypserver in /etc/yp.conf
- reboot.
This didn't work

In one of the launchpad entries, the following was mentioned: make sure hald 
starts before nis.
What I did is move the hald entry in the rc2 directory to make sure it starts 
before nis. I rebooted, and it works (I can login in kdm and at the text 
console login prompt using nis useraccounts).
But the "binding to YP server" is still slowing down the boot process a lot and 
ends with a [failure]. Workstations that still use version 6.06 (dapper) do not 
have this problem

I have this nis problem in version 7.10 (I didn't try 7.04 and 6.10) and
in 8.04. The workarounds I applied worked but are suboptimal. I'm a bit
disappointed it is not functioning in 8.10.

-- 
Can't cope with Network Manager stopping
https://bugs.launchpad.net/bugs/105648
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