Okay, I've got a dirty hack for now to work around the flicker problem in Kubuntu 8.10. You can edit /usr/bin/startkde and comment out the line starting ksmserver (kwrapper4 ksmserver).
Then instead write
kwrapper4 krunner &
kwrapper4 plasma &
There will be no session management, but also not flickering. I'll let you know when I find a better fix.
Update: Eventually I did find a much better fix. But it doesn't work for KDE 4.2 (yet).