This bug also affects me. I tried installing Ubuntu 10.04 i386 on a
Pentium 3, but it kept failing to boot from the CD. I then used Smart
Boot Manager and got it to boot from the floppy, and then from the CD. I
installed Ubuntu 10.04, but now, every time I try to boot the computer,
it says "error: out of disk." and then boots to Ubuntu, but it does not
load any session, it simply goes to a console, tty1. If I type in
"startx", I have my desktop session loaded fine, but I shouldn't have to
write a script to get it loaded automatically, it should already be
done. I used the same CD to install Ubuntu 10.04 on another machine and
all went well, so I am guessing it really is hardware specific, maybe
caused by the boot sector protection on the hard drive (which I was able
to get rid of using sbm).

I got networking working, I'll try upgrading the system and give you
more news about it, like how I fixed it, if I did, or what I tried that
did not work. But I know in the end I'll have it working, but it will
probably be a hackish solution.

-- 
grub 2 error: out of disk. failed to boot default entries. press any key to 
continue...
https://bugs.launchpad.net/bugs/477430
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