The kernel panic error is not usually by itself, it normally has some other message like "not syncing" after it. Which is it in your case? And where in the shutdown process does the panic occur (you'll have to see the messages for this).
Have you tried exiting X and then issuing the shutdown command?
There are quite a few of these. eg.
http://h20000.www2.hp.com/bizsupport...ctID=c01139152
... so it is helpful to narrow it down.