I have collected more information, and I solved my problem.
Here http://ubuntuforums.org/showthread.php?t=1318523 is an exact description of the very same problem
And here http://ubuntuforums.org/archive/index.php/t-1307879.html is an explanation of a possible answer
essentially the problem is a conflict of the intel 830 driver and Kernel probing, which is enabled by default since Kernel 2.6.30-10.12 ( see this link https://wiki.ubuntu.com/X/KernelModeSetting )
So, the solution to the screen problem is disabling Kernel probing by setting the option i915.modeset=0 in the kernel boot command line.
But, this leads to another different problem.
As documented in some web sites, this fix is accomplished by adding the option in /boot/grub/menu.lst
But, there is no /boot/grub/menu.lst in my xubuntu 9.10 .
Looking further, I found /boot/grub/grub.cfg instead.
grub.cfg has a big warning in its header DO NOT EDIT THIS.
The grub.cfg header documents that the grub.cfg file is generated from /etc/default/grub.
So following this path, I came up with the solution
I modified /etc/default/grub adding i915.modeset=0 to the default linux boot GRUB_CMDLINE_LINUX_DEFAULT
Then I regenerated grub.cfg with update-grub
And .. it works.