[Hampshire] Ubuntu Feisty - Gnome Problem

Just wondering if someone has the key to this. All was working fine, and
I cannot recall anything significant being done to the machine which
caused this.

Laptop boots fine, log in OK, then before the Gnome loading bar appears,
I get a grey rectangle in the top left of the screen, which remains
there for about 3 minutes. Then, something times out and a message
appears in the grey area saying that The GNOME settings daemon could not
be started. The xsession errors log is unhelpful, and recreating .gconf
and .gconfd doesn't help. Running gnome-settings-daemon manually doesn't
throw up any errors.
Here's the message:
<error message>
Error

There was an error starting the GNOME Settings Daemon. Some things, such
as themes, sounds, or background settings may not work correctly. The
last error message was:

Did not receive a reply. Possible causes include: the remote application
did not send a reply, the message bus security policy blocked the reply,
the reply timeout expired, or the network connection was broken.

GNOME will still try to restart the Settings Daemon next time you log in.
</error message>
I suspect the fact that ping 127.0.0.1 results in "ping: sendto:
permission denied" may have something to do with it. Both the eth0 wired
and eth1 wireless networks work fine though, /etc/hosts has correct
entries for localhost in. /etc/network/interfaces has "auto lo" in.

Any hints or pointers gratefully received!

jfk