Version details: 0.11.12

vte-0.11.12 (part of Gnome 2.10.0) is so fundamentally broken that I'm sure
it couldn't survive more than one minute of testing when a huge number of
big and complex patches were commited into CVS just a few days before
releasing Gnome 2.10.0.

It is simply unusable as a terminal emulator.

Just start gnome-terminal with its default settings (important: use the default
"None (use solid color)" setting for the background) and try to do anything
which requires the terminal to scroll its contents. E.g. Hold the Enter key
for a while at your shell prompt. Or try to view a long text file with "less"
and press the left arrow to scroll. What vte does is a complete disaster.
The cursor will be visible in many instances. The topmost line is incorrect
when "less" starts up. Its bottom status line gets repeated over and over again
filling the whole screen when you press the down arrow.

See bug #164153 including its additional comments for a detailed description.