rc.sysinit calls depmod with -A instead of -a. -A is invalid, so it fails out, thereby leaving modules unusable.
That's not an invalid flag with the modutils that shipped with beta2 ; what version do you have installed?
I get the same errors too (after a text based upgrade from RH6.2 to beta2). From /var/log/messages after the boot: Jun 23 14:31:07 wfp5ptest12 depmod: depmod: invalid option -- A Jun 23 14:31:07 wfp5ptest12 depmod: depmod 2.3.10-pre1 Jun 23 14:31:07 wfp5ptest12 depmod: depmod -a [-n -e -v -q -V] [and so on] rpm -qf /sbin/depmod says "modutils-2.3.9-6". I see the CD has modutils-2.3.11-6, so it looks like the update didn't update modutils. Installing modutils-2.3.11-6 by hand fixes the error.
Hm, OK, looks like an installer problem in that it didn't install the new modutils. Reassigned to the installer.
This should be fixed in beta3.
*** Bug 12972 has been marked as a duplicate of this bug. ***