I have just installed the new linux-image-2.6.32-25 from Ubuntu repositories, 
and faced this problem too.
The booting stops just before KDM screen should appear after the KUbuntu logo

Xorg.0.log contained the same lines:

Fatal server error:
xf86OpenConsole: VT_WAITACTIVE failed: Interrupted system call

I could not boot my computer three times concequently, including the
"failsafeX" mode. I could load it only without any graphical login
manager, and used this opportunity to reinstall back 2.6.32-24 kernel.
However, after that the 2.6.32-25 kernel is booting normally. Not sure
how this could be reproduced again.

I've never seen such things with earlier kernels.

-- 
radeon graphics mode and console does not start - xf86OpenConsole: 
VT_WAITACTIVE failed: Interrupted system call
https://bugs.launchpad.net/bugs/441653
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