Ok, looks like the it was unity-greeter that caused the problem. Fixed
after doing
gsettings set org.gnome.settings-daemon.plugins.xsettings active
true
** Changed in: gnome-settings-daemon (Ubuntu)
Status: New => Invalid
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https://bugs.launchpad.net/bugs/866047
Title:
gnome-settings-daemon does not work anymore in Oneiric
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