Turned out it is FreeNX software problem - not Fedora's. I figured out that FreeNX server is a modified version of NX free server by Nomachine. FreeNX is located at http://freenx.berlios.de/
web site and it looks like it was not updated since 2008. I installed FreeNX as outlined in wiki, got connected to my server, but immediately got a notification screen saying that gnome daemon crashed. It basically allowed me to continue the session (non critical error), but I had a feeling that I do not want use the software that crashes my system.
Then I went on Nomachine web site and and downloaded a Free Nomachine NX server (http://www.nomachine.com/select-package ... id=1&ids=2
) for Linux i386 RPM. It consists of three separate downloads: client RPM, node RPM and Server RPM. You can read on their web site detailed info on how to install it and in what order - pretty straightforward. Here is what you need to do to get it installed on Fedora 12:
1) Go to your System Preferences-->Add Remove Software and do search for "audiofile" (without quotes). It will find for you a piece of software "auodifile 0.2.6" blah blah. Install both development files and a library;
2) Do search (the same Add/remove software) for "libstdc". It will find C++ libraries, different versions. Install latest ones in case they are not yet installed;
3) Do search (same place) for "GLIBC" - it will find a few libraries there. Install the latest ones in case they are not yet installed
That's it. Then go to terminal and do "sudo rpm -i" command for all three packages that you downloaded before. You'll find detailed instructions on their web site. It may complain something about permissions for CUPS that you can ignore. Or if you want, you can follow the instructions the installer gives you, and fix permission problem and re-install. Keep in mind, that these three packages are easily removable thru Add/Remove interface in System Preferences.
Last step. Download and install NX client software (in my case it's Windows version). Once installed, you can run it with default Key and default settings. Just choose Configure button, and on General tab, choose UNIX---Gnome for the desktop. No need to export/import Keys - can run with default installed keys. For added security, you can later change Keys as described in their knowledge base (article #AR01C00126).
I am very happy with image quality and speed. This is a "must" have for Amahi setup, unless of course, you have some specific needs for VNC type stuff (I'm talking for In-home access). So my setup for headless Amahi is SSH thru Portable Putty and Nomachine Free NX server.