ubuntu 9.10 virtual console issue

i'm having a frustrating issue with virtual consoles on my ubuntu 9.10 setup
i was having trouble accessing the virtual consoles at all (no visible display) so i installed XDM and set it as the default X login manager)
now when i hit ctl-alt F1-F6 instead of the usual getty (login prompt) i get
authentication failure

authentication failure

authentication failure

(the message shows about 11 times)
and no way to log in

what is going wrong and how can i fix this?