I was able to reproduce this bug report with the file that you have
provided and with initrd.img-2.6.20-8-generic from sometime in Feisty's
development.
** Changed in: cpio (Ubuntu)
Importance: Undecided => Medium
Status: Incomplete => Confirmed
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[gutsy] cpio segs on bad input
https://bugs.launchpad.net/bugs/139928
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