This could work.

Edit /etc/inittab:
Code:
# 1:12345:respawn:/bin/bash -login < /dev/tty1 >/dev/tty1 2>&1
#1:12345:respawn:bash -login </dev/tty1 >/dev/tty1 2>&1
#2:12345:respawn:bash -login </dev/tty2 >/dev/tty2 2>&1
#3:12345:respawn:bash -login </dev/tty3 >/dev/tty3 2>&1
#4:12345:respawn:bash -login </dev/tty4 >/dev/tty4 2>&1
1:12345:respawn:/sbin/getty 38400 tty1
2:12345:respawn:/sbin/getty 38400 tty2
3:12345:respawn:/sbin/getty 38400 tty3
4:12345:respawn:/sbin/getty 38400 tty4
5:12345:respawn:/sbin/getty 38400 tty5
6:12345:respawn:/sbin/getty 38400 tty6

# X mode
#x0:5:wait:sleep 2
#x1:5:respawn:/etc/init.d/knoppix-startx start
Install a login manager:
sudo apt-get install xdm

Edit /etc/rc.local and add this at the end before exit:
/etc/init.d/xdm start