the etc message is about launching the etc-update command (as root) to update some configuration files.. BE CAREFUL USING IT, YOU CAN BRAKE THE SYSTEM! there are some files (listed by lxnay) you don't have to touch..
about kdm, you can cofigure it from control center in kde .. anyway, it's possible to configure the login manager to gdm (I like it, even if I use kde :p ) that surely let you choice the window manager before logging in .. to set gdm as default login manger ( hoping you have it installed), just edit (as root) the file /etc/conf.d/xdm properly .. inside the file read the comments that will help you ..
if someone else has a simpler method, post please
