Thanks for catching this bug. I have tested both alternate and desktop
media for the 20070319.1 daily release and the problem does not occur:

1. Reboot from installation proceeds as expected
2. Shutdown from installed system shuts down the machine
3. Reboot from installed system reboots the machine

By the way, I did not need to specify any custom kernel parameters.

-- 
Feisty Herd 1 installation hangs on reboot
https://launchpad.net/bugs/77835

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