Good afternoon all,
This afternoon I purchased and installed the classic Theme Hospital from gog.com onto my 2011 27' iMac running OS 10.10.2 (beta). I've had friends purchase from this site and have no issues. It runs the game in DOSbox, I believe.

After a few minutes of playing the game which was in full screen mode, I swiped to my main desktop to turn on the right mouse click. My screen went black, then black with purple stripes. With no response from the keyboard or mouse, I attempted to log into the iMac via SSH, this also did not work.
I force shut down the iMac, and rebooted. When I was able to I logged into my account, and was notified that there had been a graphics problem and did I want to report it - I selected "Report", and then my iMac restarted itself. This time it became stuck in a loop of rebooting - I get the boot chime, the loading bar starts to fill, the screen clears to grey, and when you would expect the login icons to display, the iMac reboots.

I have tried a number of things to remedy this:
Start in safe mode - same issue
Reset NVRAM - same issue
Enter Recovery mode - fails to enter - grey screen for at least 30 minutes
Boot into Single User mode - success! I can fsck my hard drive and remount it as RW
Launch the AHT, but this seems to fail also
Boot from a USB stick which has Yosemite on it - was used to install a Mac Pro a week ago)

Two pieces of information which may be important, seen during a verbose boot (which prints something and restarts too quickly for me to catch what it just printed):
Previous shutdown cause: -128
** GPU Hardware VM is disabled (multispace: disabled, page table updates with DMA: disabled)

I'm just doing a search for recently changed files (thinking something may be loaded during startup). Used to using Console.app, I'm not sure what logs to check via the command line in SU mode.

I'm lost at what to do next - my iMac seems stuck with no way to recover it (I've got TM backups if only I could get to an installer).

Any help would be very much appreciated.

Regards,
Ben

Bit the bullet and called Apple Care. They asked me what I had already done, and when they saw I'd done pretty much everything they would have normally suggested, they offered to carry on troubleshooting without charging me the one off £25.

In the end, they suggested a Genius booking. I pointed out that my graphics card looks like it had been recalled (only noticed today), and they said it'll be replaced under warranty.

All in all a good experience in a crap situation. I'm now alone with a cr*ppy work laptop and my aging, slowing falling apart 1st gen MacBook...

I notice you're running a beta of 10.10.2 - maybe there's a bug with the graphics drivers in that beta? Do you have an earlier bootable clone you could test to see if it's a software bug with the 10.10.2 beta?

I doubt that's the issue -> I've been running the beta for an umber of days and have done a coupe of reboots. Also, anything past the most fundamental graphics (boot drive icons, Apple logo, loading bar, Internet Recovery graphic) doesn't work, doesn't matter if I boot to Internet Recovery or to a USB drive with Yosemite install media, as soon as more sophisticated graphics are required I get nothing...