Well I got the exactly same effect on my laptop: Samsung X20 since kde
3.5.5 (dapper/edgy) ...

It's all working fine in gnome but in kde since 3.5.5 i get this grey
box about the a closed lid.

When having Suspend Option activated first thing that happens on login
is my laptop going to suspend. After re-activating everything is fine
... the laptop even susupends after closing the lid ;)

well I don't know what it is but I wanted to notice that gnome does
handle the laptop lid right.

** Changed in: linux-source-2.6.17 (Ubuntu)
       Status: Unconfirmed => Confirmed

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Toshiba Satellite A70 always reports lid as closed
https://launchpad.net/bugs/70102

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