I was able to reproduce this issue, and there was the following error in my
~/.xsession-errors file:
** (xfce4-menu-plugin:4280): CRITICAL **: Unable to get keyboard/mouse grab.
** (xfce4-menu-plugin:4280): CRITICAL **: Unable to get keyboard/mouse
grab.
** (xfce4-menu-plugin:4280): CRITICAL **: Unable to get keyboard/mouse
grab.
** Changed in: xfce-mcs-plugins (Ubuntu)
Status: New => Confirmed
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Keyboard shortcut "Control-Escape" no longer functions
https://bugs.launchpad.net/bugs/156814
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