Because of this:
register_signals();
if ( session_name )
session_name = "LXDE";
g_setenv( "DESKTOP_SESSION", session_name, TRUE );
start_session();
The "if ( session_name )" is likely meant to be "if ( !session_name )". Otherwise, no session but LXDE can be selected, but some session must be given, or it nothing is selected.
Fixed in SVN.