I can confirm this bug, latest Natty packages on a Dell Inspiron 8600.
In addition, the text mode is corrupted and reversed (O_o) in addition
to not allowing X to start. I've done a lot of searching by forcing a
framebuffer mode for textmode, and can only come down to the "set
gfxpayload..." line in grub. I have no idea how to fix it, but I thought
I'd chime in...

** Changed in: linux (Ubuntu)
       Status: Expired => Incomplete

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https://bugs.launchpad.net/bugs/685611

Title:
  [Natty] Booting fails because of GRUB setting "set
  gfxpayload=$linux_gfx_mode"

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