I'm a Fedora user but I believe this problem effects most Linux distributions. So I thought I'd make it clear to everyone with the effected hardware.
Basically, the Intel Linux developers have decided to screw with the i915 gpu Linux kernel driver which used to work for the Intel 855GM or Intel 85x graphics chips. They have decided to drop ums (user mode setting) for the driver without providing a working kms (Kernel mode setting) alternative.
So in short, if you have an Intel 85x graphics card (Extremely common on slightly older Pentium M Centrino Notebooks) You have practically zero chance of using any current distribution release which uses a current version of the Linux kernel and be able to use any kind of working xserver (Say for instance to use a desktop, kde sc, gnome, xfce, etc.)
The last working Fedora kernel version is :
I believe that any of the 2.6.30.x kernels should work on any distribution.
The recent Ubuntu LTS support release does not suffer from the problem because the Ubuntu developers identified the issue and marked it as a regression. Unfortunately, upstream are either not interested in fixing or reverting the regression or are having no real luck fixing it.
(From some bug tracker hunting, it looks like a combination of the two with the person involved in pushing the regression completely ignoring the problem.)
This issue has been known for and was reported over six months ago now. The developer who pushes the updates to the i915 driver was told that the commits he was about to push were a regression but still he pushed them and it was merged anyway.
The problem manifests itself as a complete lock up when the x server has started or shortly after the xserver has started.
No magic sysrq key combination or ctrl + alt + backspace key combination achieves any kind of escape from the lock up and the only solution is to power down the machine manually by holding down the power button.
So if you do own a machine which contains an Intel 85x graphics chip, you may as well either buy a new machine without Intel graphics to replace it or run an old distribution on it (And hope that it is ever fixed. Which seems pretty unlikely at the moment.)
I myself have one of these machines and have now learned the lesson the hard way, to never again buy a machine which contains Intel graphics hardware to try to use in conjunction with the Linux kernel. I advise others to do the same.