I upgraded from 8.10 to 9.04 and had this problem ("There was an error
creating the child process for this terminal" when starting terminal in
GNOME). Fix 1 solved this for me (`sudo mv
/etc/rcS.d/S03mountdevsubfs.sh /etc/rcS.d/S11mountdevsubfs.sh`).

Please let me know if I can provide any further helpful information.

I'm surprised this bug is marked low priority...

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/dev/pts and /dev/shm not mounted on boot
https://bugs.launchpad.net/bugs/321927
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