I'm getting this too.  My nvidia driver failed to load, my fault, but
the failure mode is terrible.

Previous releases would fall back to a low resolution driver / X server,
probably using vesa, and then ask you if you wanted to reconfigure your
video.  And if you said no it would let you just use the low resolution
X.

I think this should have a higher priority.

** Tags added: ubuntu-boot-experience

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karmic gdm restarts X infinitely when video driver fails to load
https://bugs.launchpad.net/bugs/431166
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