I have made today your test. In Feisty the Kdm login screen suggest "bug" as
username but password is required. So in my opinion there are none security
problem. I don't know the behaviour in Edgy.
Thanks for your report.
** Changed in: kdebase (Ubuntu)
Status: Unconfirmed => Needs Info
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"Start new session" auto logs in as previous new session starter
https://bugs.launchpad.net/bugs/103107
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