The window does appear briefly for me, but then it disappears almost instantly.
The good thing is that you can still enter your password and unlock the screen.
I assume you are using kdm-kde4?
** Changed in: kdebase-workspace (Ubuntu)
Sourcepackagename: None => kdebase-workspace
Status: New => Confirmed
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Password window after screensaver not displayed
https://bugs.launchpad.net/bugs/221254
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