Just confirming this bug on Ubuntu 8.04 Hardy (upgraded). System is up-to-date, 
with:
xfce4-terminal 0.2.8-4ubuntu1
xserver-xorg 1:7.3+10ubuntu10.2

xorg.conf uses i810.
Workaround to disable Composite helps.

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(i810/S3/Cirrus Logic GD 5446) + xorg = xfce crashes when opening terminal
https://bugs.launchpad.net/bugs/91849
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