I had the same problem; happened after I installed linux-
image-2.6.28-6-386 (possibly a coincidence, but I'd be surprised).  For
me, at least, it was an apparmor issue:

r...@bree:/etc/apparmor.d# ls -al /proc/sys/crypto/fips_enabled 
-r--r--r-- 1 root root 0 Jul  7 10:18 /proc/sys/crypto/fips_enabled

Since its permissions are 444, it clearly should be allowed to read.  I
admit that, since it's my personal machine, I cheated, and, instead of
learning how to fix it "right" in apparmor, I just did:

/etc/init.d/apparmor stop
chmod -x /etc/init.d/apparmor

NOTE: I do *NOT* recommend that as a work-around for a production or
Internet-accessible box.

-- 
CUPS not starting due to error reading `/proc/sys/crypto/fips_enabled' 
https://bugs.launchpad.net/bugs/392337
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