Problem affects both Maverick and Natty, upgrades as well as new
installs.

~/.xsession-errors contains:

/home/<user name>/.gnupg/gpg-agent-info-<machine name>: 1: Syntax error:
Unterminated quoted string

Removing '/home/<user name>/.gnupg/gpg-agent-info-<machine name>' fixes
the problem as a new file is generated upon login.

Inspiration on the fix for this problem from Ubuntu Forums:
http://ubuntuforums.org/showthread.php?t=1672145

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https://bugs.launchpad.net/bugs/766574

Title:
  gpg-agent update prevents login/xserver start due to config error

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