I had today the same problem, when I moved 'Home' users folders to a different partition. I solved it, not changing permissions in '.ICEauthority' file (in fact, I deleted it), but changing the owners of that folders to their users, recursively:
chown -R user /home/user
To do that, in login window, ALT+CTRL+F1 changes to a console. After that, ALT+CTRL+F7 returns to GUI mode. No need to reboot.
P.S.: Having 'home' in a separate partition, is a good way to prevent system crashes, and to upgrade versions. See wiki. I used it to install Ubuntu 12.10 in one notebook, and just to separate partitions in another notebook with 12.04LTS.