Re: I do not see this behavior on my machine
I have GNOME 2.0 on SPARC Solaris. I don't know whether this
In GNOME 2.0, gdm *did not* process ~/.profile. Prior to GNOME 2.4, gdm invoked .gnomerc at session startup time. With the change to GNOME 2.4, gdm changed to use Xsession to start the session in a manner compatible with kdm as part of a desktop regularization process.
Since you claim to have an *ancient* version of gnome running, I can only suggest that you upgrade.
If, in fact, you have the *Sun* release, I can only speculate that Sun has mislabeled gnome 2.4 as gnome 2.0.
Dos the file Xsession exist in the gdm etc directory? (on FreeBSD, this resolves to /usr/X11R6/etc/gdm/. I have no idea what Sun or Linux use for this. All of the gdm file (gdm.conf, Init/, PreSession/, etc) live there. If Xsession exists there, then you most likely have some version of gnome 2.4.
/Joe