Ah, the ecryptfs $HOME might be the problem.  I haven't tested that
and wouldn't be surprised if ecryptfs prevented the console from
looking ok.  Could you try something like:

rm -rf $HOME/.config/lxc $HOME/.local/share/lxc
sudo mkdir /opt/lxc
sudo chown -R $USER /opt/lxc
mkdir /opt/lxc/config /opt/lxc/store
ln -s /opt/lxc/store $HOME/.local/share/lxc
ln -s /opt/lxc/config $HOME/.config/lxc

Then re-try the container create/setup.  This will create the
container rootfs on a non-ecryptfs filesystem.

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https://bugs.launchpad.net/bugs/1389305

Title:
  sudo doesn't work on unprivileged lxc container

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