Confirmed that this seems to be a kernel issue. If I boot the old Feisty kernel 
(2.6.20-16) the problem does not occur.
I tried the 2.6.22-14-rt kernel and the problem is still present. I read on the 
kernel list that this problem has been noted and fixed in the rc series for the 
2.6.23 series.

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Shutdown results in a reboot
https://bugs.launchpad.net/bugs/151969
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