Sorry I'm late.

Alternate Installer (debian-install) for Ubuntu 12.04 only supports, I
think, three different ciphers: aes-cbc-plain, aes-cbc-essiv, and
something else.  Afraid it is not very fresh in my mind.  Certainly not
anyting involving aes-xts-*.

This contrasts sharply with the standard desktop installer/LiveCD, which
does support modern ciphers; it even comes with cryptsetup installed.
However, I think it lacks support for properly creating filesystems in
LUKS and LVM partitions.  In my case, what I had to do was set up all
the encryption, LVM, and filesystem stuff before starting the installer,
including luksOpen and vgchange so that the filesystems would be fully
visible to the installer.   (In order to access the LVM stuff, I had to
"apt-get install lvm2".) Afterward, before I rebooted out of the LiveCD
environment, I mounted the partitions for the new install, chroot into
it, then "apt-get install cryptsetup" (and "apt-get install lvm2") and
manually set up "(/target)/etc/crypttab".

(Dealing with a grub-efi was a different frustrating issue.)

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https://bugs.launchpad.net/bugs/993761

Title:
  Precise Server Installer does not allow to complete the encrypt
  partitions procedure

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