It looks like something in the way gpm is called is changed which leads
to the failure of the init script. When I make the call as
daemon gpm -m $DEVICE -t $MOUSETYPE
than it works.
I assume you're referring to the version of gpm that just went into rawhide, but
to be sure, what version-release are you referring to?
*** Bug 98096 has been marked as a duplicate of this bug. ***
fixed in rawhide version