I've exactly the same problem and some more hints too:

1) Happens when using desktop resolution lesser than the max. available
2) After logging out/switching the login screen is ok until I move the mouse 
pointer to the right/bottom border of the screen: it looks like if it's trying 
to SCROLL a "virtual" desktop larger than the actual screen: when scrolling it 
corrupts the display...
My guess is that somehow the width and height of desktop window at login screen 
are somehow set to wrong values, or not updated...

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Clicking "New Login" starts a new X session with corrupt/unreadable display
https://bugs.launchpad.net/bugs/22479
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