I'm having the same problem.  I killed -9 g-s-d and restarted it with
--debug. After the restart it's not using 100% cpu now, but it kept
giving "(gnome-settings-daemon:31887): libappindicator-CRITICAL **:
app_indicator_set_label: assertion `IS_APP_INDICATOR (self)' failed"
about twice per second, and my num lock key was blinking. After I
pressed the num lock key the blinking stopped and so did the messages
from g-s-d.

I am using VNC.

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https://bugs.launchpad.net/bugs/969359

Title:
  gnome-settings-daemon consumes 100% cpu

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