This bug has just struck me.

I made an iso of Xubuntu today (latest), and tried installing it on an
old computer (P2 850, 256 Ram, etc).  Install went fine, but I got
exactly the same messages as reported above (error: no such device).
This was a complete install on a small hard drive, using the whole HD
and erasing the previous OS (Win2K).

In possibly a related note, I tried installing Ubuntu 9.10 on my main
desktop computer today (a P4 3.0 Ghz).  It has Win XP installed.  During
the installation, I told it create a partition in the large unused
portion of my secondary harddrive (not the hard drive that Windows boots
from).  When the install completed and the computer rebooted, I got the
typical Grub menu, but when I selected to boot from grub, I got a blank
screen with a blinking cursor in the upper left corner of the screen and
it sounded like the HD was seeking over and over.  Nothing ever
happened.  I had to do a hard reset after about 5 min.

I haven't tried any of the fixes suggested, because that's not really a
fix and I'm not comfortable editing those file(s).

-- 
Grub 2 problem, error: no such device
https://bugs.launchpad.net/bugs/403408
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