If you boot without "quiet splash" on the kernel command-line do you see
any messages about /dev/pts on your screen?

Please attach the contents of your /etc/rcS.d, /etc/init.d and
/lib/udev/devices directories; also attach /var/log/udev

Thanks,

** Changed in: gnome-terminal (Ubuntu)
       Status: New => Incomplete

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gnome-terminal does not launch on upgrade to jaunty
https://bugs.launchpad.net/bugs/360160
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