Tried Peter Jensens approach on Ubuntu 12.04 LTS under Virtualbox  4.2.4
r81684 with extensions. Unchecked the draw-background value... but no
change in behavior... It still blocks all other screens in seamless
mode... it even redraws the background. (Yes, I have rebooted after
changing the value and gconf-editor says its OFF).

So problem still unsolved for me... have been forced to switch to other
distribution for now.

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https://bugs.launchpad.net/bugs/999929

Title:
  Seamless Mode Not Working Correctly in Virtual Box

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