gnome-settings-d crashes after update of xkeyboard-config

Problem with gnome-settings-daemon when upgrading xkeyboard-config from
0.6-5 to 0.6-5breezy1. gnome-settings-deamon crashes.

Running Ubuntu Breezy on a HP Laptop ze4400. No problems encountered until
update of xkeyboard-config. I have installed all the latests updates.

GNOME settings daemon exits with:

There was an error starting the GNOME Settings Daemon.
Some things, such as themes, sounds, or background settings may not work correctly.
The Settings Daemon restarted too many times.
The last error message was:
Child process did not give an error message, unknown failure occurred
GNOME will still try to restart the Settings Daemon next time you log in.

In the terminal the gnome-settings-daemon outputs:

Warning: Type "ONE_LEVEL" has 1 levels, but <RALT> has 2 symbols
                  Ignoring extra symbols
Warning: No symbols defined for <SYRQ> (keycode 92)
<... More warnings for symbols ...>
Warning: No symbols defined for <I7E> (keycode 254)
Warning: No symbols defined for <I7F> (keycode 255)
The program 'gnome-settings-daemon' received an X Window System error.
This probably reflects a bug in the program.
The error was 'BadValue (integer parameter out of range for operation)'.
  (Details: serial 807 error_code 2 request_code 147 minor_code 9)
  (Note to programmers: normally, X errors are reported asynchronously;
   that is, you will receive the error a while after causing it.
   To debug your program, run it with the --sync command line
   option to change this behavior. You can then get a meaningful
   backtrace from your debugger if you break on the gdk_x_error() function.)
[1133172382,000,xklavier.c:XklStartListen/] The backend does not require
manual layout management - but it is provided by the application

Problem is solved when the packages is downgraded from xkeyboard-config
0.6-5breezy1 to 0.6-5.

Output from gconftool-2:
gconftool-2 -R /desktop/gnome/peripherals/keyboard/kbd

 layouts = [us intl]
 model = hpxt1000
 options = [grp grp:alts_toggle,eurosign eurosign:5,Compose key
compose:ralt,lv3 lv3:lwin_switch]
 overrideSettings = true

I noticed libxklavier crashes frequently if keyboard settings are changed and
the configuration does not reflect the updated xkeyboard-config.

Reproduce:

Reproduce this by probably using the same keyboard settings and updating back
and forth between xkeyboard-config 0.6-5 and 0.6-5breezy1

I have done this twice and both times the gnome-settings-daemon leaves me with
a default gnome desktop.