This is obviously a rather artificial scenario, but I though you might like to know about it.
When you log in to a remote computer using LogMeIn (Free, in my case), LogMeIn offers you the option of logging into your Windows account for you.
With the Yubikey plugged in to the remote PC, it works fine.
If, however, the Yubikey isn't plugged in, (a) the login fails (which it probably should) but (b) the Windows login screen on the remote PC appears to get messed up (the password entry field vanishes), and the only non-reboot way I found for logging on was to insert the Yubikey, and then log on via LogMeIn. That is, I couldn't find a way to log in from the physical PC.
As I said, this isn't an issue for me, as the case is rather artificial, but you may want to look at this, and, possibly, interact with LogMeIn in order to make it fail a bit less aggressively.
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