Errors from log file:
08:08:01 T:4513184 ERROR: GLX: Same window as before, refreshing context
08:08:02 T:4513184 NOTICE: UDisks: Added /home
08:08:02 T:4513184 NOTICE: start dvd mediatype detection
08:08:02 T:4513184 NOTICE: initializing playlistplayer
08:08:02 T:4513184 NOTICE: DONE initializing playlistplayer
08:08:02 T:4513184 ERROR: Unable to open audio mixer
08:08:02 T:4513184 NOTICE: initialize done
08:08:02 T:4513184 NOTICE: Running the application...
08:08:02 T:4513184 NOTICE: ES: Starting event server
08:08:02 T:3023043440 NOTICE: ES: Starting UDP Event server on 0.0.0.0:9777
08:08:02 T:3023043440 NOTICE: UDP: Listening on port 9777
08:08:02 T:4513184 NOTICE: starting zeroconf publishing
08:08:02 T:2987391856 NOTICE: -->Python Interpreter Initialized<--
08:08:04 T:4513184 ERROR: XLCDproc::Connect - Unable to connect to host, LCDd not running?
08:08:04 T:4513184 ERROR: XLCDproc::Initialize - Connect failed. Retry in 4 seconds.
08:08:08 T:4513184 ERROR: XLCDproc::Connect - Unable to connect to host, LCDd not running?
08:08:08 T:4513184 ERROR: XLCDproc::Initialize - Connect failed. Retry in 8 seconds.
08:08:16 T:4513184 ERROR: XLCDproc::Connect - Unable to connect to host, LCDd not running?
08:08:16 T:4513184 ERROR: XLCDproc::Initialize - Connect failed. Retry in 16 seconds.
08:08:17 T:4513184 ERROR: GetDirectory - Error getting /home/administrator/.xbmc/media/Fonts/
08:08:17 T:4513184 ERROR: GetDirectory - Error getting special://home/media/Fonts/
08:08:32 T:4513184 ERROR: XLCDproc::Connect - Unable to connect to host, LCDd not running?
08:08:32 T:4513184 ERROR: XLCDproc::Initialize - Connect failed. Retry in 32 seconds.
08:08:40 T:4513184 ERROR: PulseAudio: Failed to connect context
08:08:40 T:4513184 ERROR: PulseAudio: Failed to create context
08:08:40 T:4513184 ERROR: Unable to open audio mixer
Did some further digging... it looks like this issue is caused by the .asoundrc file being corrupt. I followed the instructions on the following thread:
http://forum.xbmc.org/showthread.php?tid=127361.
Bascially backup the .asoundrc file for the current user and re-ran alsamixer and all was well. I rebooted the box and all worked well.
Hope this works for you OP.