I recently used the latest version of Puppy linux(5.0.1) and encountered
the same problem, and got throught by using 'i915.modeset=0' in the boot
parameters. So this appears to be a bug in the new kernel source itself.
** Also affects: puppy
Importance: Undecided
Status: New
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[i855] X doesn't start with kernel 2.6.32-21 unless passing i915.modeset=1
https://bugs.launchpad.net/bugs/566379
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