The issue here seems to be the "splash" boot option
If I remove it then booting to the live session or installer works fine, no 
need for nomodeset, no video degradation at all.

Noticed this also recently when try to boot to an eariler kernel from
grub. With the default boot options was more often than not getting a
degraded unity-greeter that was unusable. Same thing - removing splash &
all was fine

>From a user perspective - I don't even see the complete boot line on the live 
>cd. It ends with splash --
Fotunately splash was visible so it could be removed.. I wonder if some 
hardware may not even see splash  ..??

** Summary changed:

- live cd is unusable due to video degradation
+ live cd is unusable due to video degradation with the splash boot option 
enabled

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https://bugs.launchpad.net/bugs/1043518

Title:
  live cd is unusable due to video degradation with the splash boot
  option enabled

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