The main problem: startx does not start fluxbox, server disconnects, but xinit $(which xterm) works.
X.org (and EDID) problem started with installing fresh 16.10. Minimal ubuntu console, Xorg, Fluxbox.
when /etc/default/grub has LINUX_COMMAND_LINE_DEFAULT="splash quiet", then I get the drm:drm_edid_block_valid] ERROR EDID has major version 0, instead of 1. This message splashes in terminal in batches of lines. Before installing xserver-xorg-legacy starting fluxbox with startx was possible despite messages and fluxbox functioned fine. After installing xserver-xorg-legacy it only returns "connection to server lost, disconnecting).
same when LINUX_COMMAND_LINE_DEFAULT="text"
when LINUX_COMMAND_LINE_DEFAULT="nomodeset" console works fine, xinit $(which xterm) functions fine, .xinitrc and .Xauthority both owned by user (not root), but startx does not work. Log file points out to KMS not supported and server shuts down afterwards.
Older hardware, worked excellent on 16.04 but X problems on 16.10.
Compaq Presario 2100 (2003), AMD, ATI Radeon RS-100 video card.