UPDATED: To save you reading time...
I have found that this is not nouveau related.
I found that I can start an X session as root or normal user with:
with the normal client xinitrc files, or the default.
But startx fails... or so I thought. It turns out that if I invoke startx and just wait about 30 seconds it will in fact start the X session (patience is a virtue...).
The only message I get is:
xauth: file .../.serverauth.xxxx does not exist
and my guess is that startx is waiting for X authorization??
I am out of my knowledge zone with that...
Any tips why startx would fail in this manner?