What happens if you bring up any other desktop?

VD? Can't get to them. Only appear to have one.

Complete separate user? Appears to work fine (at least, as root anyway). Hmmm.

Did you do a full install? If yes, you will have KDE and several other desktops installed. From the login screen you should be able to select KDE or what ever.

Have you tried creating a new user? and what happens then?

I know it's been a long time since anyone posted here, and I don't like digging up the dead any more than the next man, but I have an obligation to report a solution, if I find one. And I've found one.

Anyone else who has this problem, start XFCE as normal, and open a terminal. In that terminal, run xfwm4. It should fix the issue. You can then control-C it, and use/close the terminal, and it will stay fixed. Apparently, XFWM4 (XFCE's window manager) sometimes doesn't exit gracefully when it crashes, and needs to be started up again manually. Definitely need to report this, when I get 2 minutes spare.