Ok, This is a strange one. A quick background. I'm running Crunchbang waldorf the newest stable release. I have been running it for quire a while. No real issues. It uses the Slim logon manager, open box WM and the debian wheezy kernel.

I was compiling kernel 3.10 in my home directory, something I've done 100's of times, but this is the first time in this version of crunchbang. The only thing I did different is that I generally I don't use the "make install" scripts when building the kernel, however I did this time because I still don't understand or like grub (>1.99). I think I'm switching to LILO as soon as this is resolved.

Anyway. here's the probem. Rebooted, got a kernel panic on the new kernel. No big deal. I already know the problem. Rebooted again and chose my original kernel 3.2.x everything loads normally. I get to the slim login without a problem.

here is where it gets weird. I cannot log in as me or any other user (via slim). I can however log in as root. I switched to another tty and checked the logs. I cannot find any error messages, and quite honestly nothing seems different. I tried starting X (as a user) from tty2 and it's starts without a problem. For whatever reason it runs the first use startup scripts, and the wallpaper was not set. I mention this because all my other scripts eg. tint, conkey, menu.xml, rc.xml appear to be properly running and the same.

I'm sorry I can't give any more info than this, but I can't find anything that appears to be wrong. Does anyone have any ideas?

I'm using SLiM but don't have this problem. Check this thread, it might have a solution.

hmmmmm.... Similar symptoms but I don't think that is the problem.

I'm wondering if it's an issue with pam.d.